PLDT, Inc. · PSE:TEL
PLDT — Q1 2016 Earnings Presentation
41 slides from PLDT's earnings presentation, May 3, 2016
Slide 1: Delivering the total digital experience
Delivering the total digital experience PLDT, Inc. First Quarter 2016 Financial and Operating Results Tuesday, 3rd May 2016 1
Slide 2: PLDT Group: Our Digital Roadmap
PLDT Group: Our Digital Roadmap PLDT’s Digital Pivot is a 3-year journey starting 2016 Organization and processes being oriented digitally Earnings reset to a new level in 2016 “Work-in-progress” with early signs of improvement Key enablers for PLDT as THE Digital Telco Data, data, data
Slide 3: PLDT Group: 1Q16 vs 1Q15 Financial Highlights
PLDT Group: 1Q16 vs 1Q15 Financial Highlights Revenues P42.8bn +1% P0.2bn Service Revenues Service Revenues (net of interconnect) P40.6bn 0% P38.2bn 1% P0.1bn P0.2bn Service Revenues (ex-ILD/NLD) Wireless (ex-ILD) Fixed Line (ex-ILD/NLD) Service Revenues Service Revenues P36.2bn +3% P24.4bn P13.9bn
Slide 4: Home Q1 Headlines
Consumer Home Q1 Headlines 2x Total Revenue Growth Increasing Fixed Data Unmatched Digital 5th Year of Consecutive Growth Growth Services Aggressive fiber roll-out and superiority Smart Home services on entertainment in data offers & home monitoring Q1 2016 vs Q1 2015 Q1 2016 vs. Q1 2015 +10.3% +16%
Slide 5: Mobile Q1 Headlines
Consumer Mobile Q1 Headlines Ramped Up Broadband 2x Mobile Data Growth SMART Postpaid Growth Growth Powered by content & high conversion Powered by partnerships on content and from free basics digital services Powered by partnerships on content and digital services +83% +38% +14% Increase in Increme
Slide 6: The Digital-Everywhere Consumer
Consumer The Digital-Everywhere Consumer Out of home Home Entertainment Everywhere Peace of Mind Everywhere Convenience Everywhere Productivity Everywhere 6
Slide 7: Enterprise: Robust Core Business with Surging IT & Global Services
Enterprise: Robust Core Business with Surging IT & Global Services Service Revenues (net of intercompany transactions) In PhP Billions Q1 2015 Q1 2016 GROWTH 10% Fixed/ICT 5.87 6.44 0.57 15% Wireless 0.97 1.11 0.14 TOTAL 10% 6.84 7.55 0.71 • Fixed revenues were driven by the data business which grew
Slide 8: Voyager: Breakthrough Digital Services Hit Critical Mass and Early Monetization
VOYAGER: Breakthrough Digital Services Hit Critical Mass and Early Monetization PLDT’s Digital Innovation arm -- Voyager -- has successfully launched two Digital Services which have achieved critical mass Pay Maya FINTQ PayMaya dominates the fast-growing FINTQ has taken first-mover advantage in the
Slide 9: Voyager: First-mover FINTQ gains strong traction
Voyager: First-mover FINTQ gains strong traction with both consumers and financial services providers PH’s first and globally recognized Service Updates paperless and fully digital Telco and bank- agnostic proposition consumer lending with insurance PCI-DSS certified in 1/16 and auto-savings feature
Slide 10: Service Revenues (excluding ILD/NLD)
Service Revenues (excluding ILD/NLD) (Php in billions) vs Y-o-Y: Consolidated +3% or P0.9bn 36.2 36.2 36.0 +0.2 +1% +1% +0.5 35.6 +0.3 35.3 1Q15 2Q15 3Q15 4Q15 1Q16 Service Revenues Mix: Data/broadband 32% 34% 36% 36% 38% SMS/Domestic Voice 68% 66% 64% 64% 62% Wireless Fixed Line* vs Y-o-Y: vs Y-o-Y
Slide 11: PLDT Group: Consolidated Service Revenues
PLDT Group: Consolidated Service Revenues (Php in billions) By Service Revenue Streams Service Revenue Mix 1Q15 1Q16 Increase of P0.1bn Data/broadband 28% 34% Domestic Voice and Others 59% 55% Data, broadband and SMS and VAS, Voice ILD/NLD 13% 11% digital platforms domestic and others ILD and NLD
Slide 12: Breakdown of Consolidated Service Revenues
Breakdown of Consolidated Service Revenues (Php in billions) Consumer Service Revenues Mix 1Q15 1Q16 Higher by P0.4bn or 1% Data/Broadband 28% 34% Voice 39% 37% SMS 31% 27% Fixed Fixed Wireless Line Wireless Line Voice Voice SMS Mobile Broadband Internet Data +4% -6% -10% +18% -0.8 +32% +19% +0.4 +0
Slide 13: Consolidated Service Revenues: Consumer and Enterprise
Consolidated Service Revenues: Consumer and Enterprise (Php in billions) CONSUMER Y-o-Y: 26.2 26.3 26.6 26.8 26.6 +1% or P0.4bn +0.3 +0.2 -0.2 -- -1% 0% +1% +1% Y-o-Y: 19.6 -0.1 19.5 19.7 +0.1 19.8 -0.3 19.5 -1% or (P0.1bn) +0.2 0% -2% -1% +1% +0.1 +0.1 Y-o-Y: 6.7 +0.1 6.8 +0.1 6.9 1% 7.0 +2% 7.1 +7
Slide 14: Data and broadband
Data and broadband (Php in billions) Revenues Wireless Broadband Fixed Broadband Mobile Internet Corp. Data Q-o-Q +6% +11% +22% 13.7 +0.8 +1.1 +2.5 11.2 3.2 +12% 10.1 +24% +15% 2.6 +12% 2.3 3.1 2.2 +38% 1.9 +19% 3.8 +16% 4.4 +4% 3.5 +10% 2.9 -- 2.4 +2% 2.5 +17% 1Q14 1Q15 1Q16 Mobile Internet Fixed B
Slide 15: Fixed line and wireless: Service Revenues
Fixed line and wireless: Service Revenues (Php in billions) +5% Fixed Line Higher by P1.2bn or 8% Service Revenue Mix 1Q15 1Q16 Data/broadband 56% 59% Data and Domestic voice Domestic Voice and Others 32% 31% Broadband and Others ILD and NLD ILD/NLD 12% 10% +1.1 +0.2 -0.1 +13% +4% -4% 15.4 14.3 1Q 2
Slide 16: Fixed line business: When did we reach the inflection point?
Fixed line business: When did we reach the inflection point? (Php in billions, except % to total fixed line service revenues) +5% +4% 58.8 +4% 56.1 -4% +4% +5% 53.7 51.2 -5% +1% 51.4 49.3 51.1 48.6 49.0 30% 29% 26% 28% 29% 27% 28% 27% 26% 54% 57% 36% 38% 42% 51% 48% 45% 45% 7% 11% 25% 27% 14% 18% 19
Slide 17: PLDT Group: Consolidated EBITDA
PLDT Group: Consolidated EBITDA (Php in billions) Lower by P2.7bn or 14% Decline mainly due to rise in subsidies by P1.4bn resulting Svc Rev Subsidies from initiatives to expand 19.3 +0.1 -1.4 Cash smartphone ownership to grow Opex Provns postpaid cellular revenues and -0.6 to further stimulate da
Slide 18: PLDT Group: Core and reported net income
PLDT Group: Core and reported net income (Php in billions) Core Net Income Core net income for 2016 estimated at Lower by P2.1bn or 22% P28.0bn Based on 1Q16 results, PLDT is on track to meet guidance Fin Net Provn EBITDA Non-cash Costs - equity in for Inc 9.3 -2.7 expenses Net earnings Others T
Slide 19: PLDT Group: Capex
PLDT Group: Capex Fixed Line Wireless 43.2 43.0 36.4 34.8 31.2 28.8 12.9 14.6 13.9 1.0 13.7 11.7 13.7 11.7 13. 30.3 29.2 6 17.2 22.1 17.1 23.0 2.9 1.2 1.8 2011 2012 2013 2014 2015 2016 1Q15 1Q16 Guidance % of Capex to total service revenues: up to 21% 23% 18% 21% 26% 26% Note: BPO capex up to 2012 o
Slide 20: PLDT Group: Debt Profile
PLDT Group: Debt Profile Debt Balance Debt Maturities (US$ in billions) (US$ in millions, as of end March 31, 2016) 3.4 3.5 Total: US$3,520mn 1,069 2.9 2.9 2.4 2.3 2.4 2.5 1.9 1.6 662 0.9 0.6 1.0 1.1 446 0.7 395 369 296 283 2012 2013 2014 2015 1Q2016 Debt Balance* Cash & Short-term Investments Net D
Slide 21: PLDT Group Guidance for 2016
PLDT Group Guidance for 2016 Low single digit growth in consolidated service revenues Data/broadband double-digit growth to continue EBITDA Anticipated declines in toll, cellular voice and SMS revenues Stable vis-à-vis 2015 Anticipated increases in costs to support efforts to grow data/broad
Slide 22: Details
Details 22
Slide 23: PLDT Group: Subscribers
PLDT Group: Subscribers Total Group Subscribers end March 2016 72.1mn Cellular Subscribers Fixed Line Subscribers in mn in mn Q-o-Q: Y-o-Y Q-o-Q Y-o-Y Q-o-Q -6% -7% -1% Y-o-Y: Total 2.3 +5% +2% Total 64.4 Total group subscribers Postpaid 3.0 +2% remained stable q-o-q from a PLDT 2.3 +7% +3% 3% q-o
Slide 24: Appendix
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Slide 25: Subscriber Data: Cellular
Subscriber Data: Cellular Cellular Subscribers by category: 1Q16 vs 1Q15 Net Adds Mar-16 Dec-15 Sept-15 Jun-15 Mar-15 Net Adds % 1Q16 % CELLULAR Prepaid 61,484,747 61,980,425 64,082,775 65,843,593 66,721,243 (5,236,496) -8% (495,678) -1% Smart Prepaid 22,224,447 22,892,303 23,390,886 24,188,189 24,8
Slide 26: Subscriber Data: Broadband and Fixed Line
Subscriber Data: Broadband and Fixed Line Broadband subscribers 1Q16 vs 1Q15 Net Adds Mar-16 Dec-15 Sept-15 Jun-15 Mar-15 Net Adds % 1Q16 % BROADBAND Wireless Broadband 3,989,519 3,932,820 3,789,654 3,676,164 3,391,440 598,079 18% 56,699 1% Smart Broadband 3,143,892 3,057,958 2,896,187 2,829,074 2,6
Slide 27: 1Q2016: Consolidated Financial Highlights
1Q2016: Consolidated Financial Highlights 1Q2016 1Q2015 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (unaudited) (unaudited) Total Revenues 27,931 17,935 - 42,779 42,553 1% Service Revenues 26,670 17,015 - 40,598 40,548 - Cash operating expenses 12,515 10,213 15 19
Slide 28: Reconciliation of Core and Reported Net Income
Reconciliation of Core and Reported Net Income 1Q2016 1Q2015 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (unaudited) (unaudited) Net Income attributable to equity holder of PLDT 4,273 2,535 (591) 6,217 9,387 (34%) Add (deduct): Foreign exchange gains, net (604) (1
Slide 29: Consolidated Service Revenues
Consolidated Service Revenues 2016 2015 (Php in millions) 1Q 1Q 2Q 3Q 4Q FY Fixed line 14,287 13,034 13,302 13,589 13,817 53,742 Fixed Line voice - domestic 4,333 4,172 4,226 4,280 4,301 16,979 Fixed Line voice - international 1,240 1,311 1,323 1,273 1,336 5,243 National long distance 844 923 906 91
Slide 30: Consolidated Service Revenues and EBITDA
Consolidated Service Revenues and EBITDA 2016 2015 (Php in millions) 1Q 1Q 2Q 3Q 4Q FY Growing revenue base 13,805 11,441 12,086 12,986 13,032 49,545 Mobile Internet 3,091 2,235 2,543 2,871 2,772 10,421 Wireless broadband 2,931 2,506 2,655 2,820 2,925 10,906 Fixed broadband 4,402 3,808 3,959 4,109 4
Slide 31: Wireless Service Revenues and EBITDA
Wireless Service Revenues and EBITDA 2016 2015 (Php in millions) 1Q 1Q 2Q 3Q 4Q FY Growing revenue base 6,185 5,028 5,465 6,063 5,907 22,463 Mobile internet 3,091 2,235 2,543 2,871 2,772 10,421 Wireless broadband 2,960 2,528 2,677 2,841 2,945 10,991 Digital 134 265 245 351 190 1,051 Mature revenue b
Slide 32: Fixed Line Service Revenues and EBITDA
Fixed Line Service Revenues and EBITDA 2016 2015 (Php in millions) 1Q 1Q 2Q 3Q 4Q FY Growing revenue base 9,110 8,074 8,261 8,537 8,876 33,748 Fixed broadband 4,428 3,812 3,962 4,113 4,254 16,141 Corp. data and other network services 3,944 3,660 3,680 3,747 3,916 15,003 Data center and ICT 738 602 6
Slide 33: Expenses
Expenses 1Q2016 1Q2015 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (unaudited) (unaudited) Operating expenses Compensation and employee benefits 1,886 3,349 - 5,231 4,981 5% Repairs and maintenance 2,049 1,745 - 3,671 3,667 - Selling and promotions 1,250 468 - 1,7
Slide 34: Other Income (Expenses)
Other Income (Expenses) 1Q2016 1Q2015 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (unaudited) (unaudited) Equity share in net earnings of associates and joint ventures (30) (68) 735 637 653 (2%) Interest income 113 182 19 255 184 39% Gains (losses) on derivative f
Slide 35: Cellular and Broadband Net ARPU
Cellular and Broadband Net ARPU Cellular Net ARPU 2016 2015 1Q 1Q 2Q 3Q 4Q Smart Postpaid 999 1,039 1,065 1,021 1,014 Smart Prepaid 109 118 114 115 113 TNT 80 85 83 82 83 Sun Cellular Prepaid 78 63 64 65 71 Sun Cellular Postpaid 459 449 419 436 475 Cellular Prepaid and Postpaid blended Net ARPU 2016
Slide 36: Earnings Per Share
Earnings Per Share 1Q2016 1Q2015 (unaudited) (unaudited) Basic Diluted Basic Diluted Net income attributable to equity holders of PLDT 6,217 6,217 9,387 9,387 Dividends on preferred shares (15) (15) (14) (14) Net income for the period attributable to common equity holders of PLDT 6,202 6,202 9,373 9
Slide 37: Balance Sheet
Balance Sheet Consolidated March 31, 2016 December 31, 2015 (Php in millions) (unaudited) (audited) Total Assets 466,102 455,095 Nominal Value of Total Long-term Debt 161,881 161,568 in US$ $3,520 $3,429 Less: Unamortized Debt Discount 691 676 Total Long-term Debt 161,190 160,892 Cash and short-term
Slide 38: Debt Profile
Debt Profile (US$ in millions) 2011 2012 2013 2014 2015 1Q2016 Debt Balance 2,719 2,851 2,353 2,920 3,429 3,520 Cash and short-term investments 1,061 919 735 610 1,016 1,054 Net Debt 1,658 1,932 1,618 2,310 2,413 2,466 Interest-bearing Liabilities March 31, 2016 December 31, (unaudited) 2015 Unamort
Slide 39: Foreign Exchange Risk
Foreign Exchange Risk Forex Impact on Core Income Forex Impact of B/S Revaluation Forex Impact on Derivatives Forex sensitivity for every P1 change (in US$ millions) Forex sensitivity for every P1 change on B/S Revaluation (in US$ millions) Conso Conso - net of Elim P1 movement in the Debt (net of L
Slide 40: Forward-looking statements
Except for historical financial and operating data and other information in respect of historical matters, the statements contained herein are “forward-looking statements” within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchang
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