PLDT, Inc. · PSE:TEL

PLDT — FY2013 Earnings Presentation

34 slides from PLDT's earnings presentation, Mar 4, 2014

  1. Slide 1: Full Year 2013 Financial and Operating Results

    Full Year 2013 Financial and Operating Results 4 March 2014 Shangri-la Hotel, Makati

  2. Slide 2: PLDT Group: 2013 Financial Highlights

    PLDT Group: 2013 Financial Highlights Foreign Exchange Rates (Php:US$1) 2013 2012 % Y-o-Y Period-end 44.40 41.08 8% Period-average 42.44 42.24 0% * Excluding BPO business segment ** EBITDA margin calculated as EBITDA divided by service revenues (gross of interconnect expenses) 2

  3. Slide 3: PLDT Group: Service Revenues and EBITDA

    PLDT Group: Service Revenues and EBITDA  The on-going structural change in PLDT’s revenue mix Consolidated Service Revenues continues to temper consolidated service revenue growth (Php in billions) rates and EBITDA margins Growing Steady Declining  Revenues from our growing data businesses already

  4. Slide 4: PLDT Group: Core and Reported Net Income

    PLDT Group: Core and Reported Net Income  Core net income for 2013 of P38.7bn is 5% or P1.8bn higher than Core Net Income P36.9bn in 2012 mainly due to: (Php in billions)  Rise in service revenues by P4.3bn which more than offset a P2.2bn increase in subsidies  Decrease in cash operating expenses

  5. Slide 5: Capital Management

    Capital Management Dividend Declaration  PLDT’s dividend policy: regular dividends of 70% of core EPS + “look back” to determine Core earnings for 2013 P 179 per share possibility of a special dividend Interim Regular Dividend (Aug 2013) P 63 per share Dividends declared (4 March 2014) P116 per sha

  6. Slide 6: Broadband revenues and outlook

    Broadband revenues and outlook  Broadband service revenues grew by P3.7bn or 16% year-on-year to P26.6bn or 16% of consolidated service revenues in 2013 from 14% last year Consolidated Broadband Service Revenues  Mobile internet revenues of P5.0bn were higher by P1.8bn or 59% and (Php in billions)

  7. Slide 7: Wireless revenues and outlook

    Wireless revenues and outlook  Wireless service revenues increased by P2.9bn or 3% year-on-year to Wireless Service Revenues P116.7bn in 2013 underpinned by the unabated growth in non-SMS data (Php in billions) and cellular voice revenues  Cellular voice revenues rose by P1.8bn or 4% to P51.4bn, o

  8. Slide 8: Fixed line revenues and outlook

    Fixed line revenues and outlook  Fixed line service revenues for 2013 grew by P2.2bn or 4% year-on- Fixed Line Service Revenues* year to P53.7bn mainly from increases in retail and corporate data (Php in billions) revenues  Data revenues of P27.2bn rose by 10% or P2.4bn, and now represent LEC NLD

  9. Slide 9: Updates on PLDT Group multi-media initiatives

    Updates on PLDT Group multi-media initiatives PLDT triple-play: Fibr (fiber-to-the-home) SPINNR, powered by Smart Music, is the Direct-to-home (DTH) CignalTV (ePLDT + landline + CignalTV content through a biggest on-line music portal in the investment via Mediaquest PDRs) dedicated connection Philip

  10. Slide 10: PLDT Group: Debt Profile

    PLDT Group: Debt Profile  Net debt of US$1.6bn and net debt to EBITDA ratio of Debt Balance 0.93x as of YE13 were both lower compared with YE12 (US$ in billions)  At end December 2013, gross debt declined by US$0.5mn to US$2.4bn  57% of gross debt is US$ denominated  Taking into account our US$

  11. Slide 11: Free Cash Flow and Capex

    Free Cash Flow and Capex  Free cash flow for 2013 rose by P4.4bn or 12% to P42.0bn from Free Cash Flow P37.6bn in 2012 mainly due to: (Php in billions)  Lower capex by P7.6bn 2012 2013  Lower net increase in working capital of P5.1bn  Higher income taxes paid by P1.5bn 7.1 (10.1) 83.3 2.0 (11.6)

  12. Slide 12: PLDT Group Guidance for 2014

    PLDT Group Guidance for 2014 Core Net In P39.5bn Core Net Income (P0.8bn or 2%(POc higher than 2013) P31-32.0bn Capex Core Net Income (18-20% of service revenues) Dividend Pay-out Policy: Capital Management 70% of CoreCore EPS Net Income approach + “look-back” 12

  13. Slide 13: Appendix

    The future is in our fiber. 2a, C3 Oop wy fe 7 Y Appendix UN eget \4 PLDT smarr a 13

  14. Slide 14: Financial Investment in PDRs of MediaQuest

    Financial Investment in PDRs of MediaQuest  PLDT, through ePLDT, made a P9.6bn investment in Philippine Depository Receipts (PDRs) of MediaQuest for a 64% economic interest in CignalTV (a 100% subsidiary of MediaQuest)  Investment in Cignal TV equity accounted in PLDT‟s financials starting 4Q13 

  15. Slide 15: PAS 19 Adjustments

    PAS 19 ADJUSTMENTS  Change in PAS19 affecting termination benefits (MRP costs): Old PAS 19 – allows for the recognition of termination benefits when the Company is demonstrably committed to provide termination benefits, which only entails an approved detailed, formal plan and that plan has no reali

  16. Slide 16: Subscriber Data: Cellular

    Subscriber Data: Cellular Cellular Subscribers by category: FY13 vs FY12 Net adds Dec- 13 Sept- 13 Jun-13 Mar-13Mar-10 Net Adds % 1Q2013 % 2Q2013 % 3Q2013 % 4Q2013 % CELLULAR Prepaid 67,667,750 70,198,270 71,197,952 69,628,396 56,213 0% 2,016,859 3% 1,569,556 2% (999,682) -1% (2,530,520) -4% Smart P

  17. Slide 17: Subscriber Data: Broadband

    Subscriber Data: Broadband FY13 vs FY12 Net adds Dec-13 Sept-13 Jun-13 Mar-13 Net Adds % 1Q2013 % 2Q2013 % 3Q2013 % 4Q2013 % BROADBAND Wireless Broadband 2,453,826 2,378,607 2,322,416 2,238,979 94,802 4% (120,045) -5% 83,437 4% 56,191 2% 75,219 3% Smart Broadband 1,909,209 1,843,839 1,803,520 1,740,

  18. Slide 18: FY2013: Consolidated Financial Highlights

    FY2013: Consolidated Financial Highlights FY2013 FY2012 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (audited) (as adjusted) Service Revenues 116,679 61,870 - 164,052 159,738 3% (1) Cash operating expenses 52,661 38,005 5 75,573 76,508 -1% Depreciation and amortiza

  19. Slide 19: Reconciliation of Core and Reported Net Income

    Reconciliation of Core and Reported Net Income FY2013 FY2012 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (audited) (as adjusted) Net Income attributable to equity holder of PLDT 21,909 7,788 3,508 33,351 35,605 -6% - continuing operations Add (deduct): Foreign exc

  20. Slide 20: Consolidated Service Revenues

    Consolidated Service Revenues % Change 2013 2012 FY13 vs 4Q13 vs (Php in billions) 1Q 2Q 3Q 4Q FY 1Q 2Q 3Q 4Q FY FY12 4Q12 3Q13 SMS 11.9 11.9 11.5 ** 11.9 47.3 12.0 12.2 11.9 12.2 48.3 -2% -3% 3% Voice - Domestic 13.3 13.9 13.7 14.3 55.2 13.4 13.4 13.2 13.6 53.6 3% 5% 5% Voice - International 5.5 5.

  21. Slide 21: Expenses

    Expenses FY2013 FY2012 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (audited) (as adjusted) Operating expenses Compensation and employee benefits (1) 8,190 11,939 - 20,100 23,286 -14% Repairs and maintenance 7,861 5,930 - 13,107 12,604 4% Selling and promotions 7,9

  22. Slide 22: Other Income (Expenses)

    Other Income (Expenses) FY2013 FY2012 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (audited) (as adjusted) Gains (losses) on derivative financial instruments, net (18) 523 6 511 (2,009) 125% Interest income 324 392 249 932 1,354 -31% Equity share in net earnings (l

  23. Slide 23: Wireless and Broadband Net ARPU

    Wireless and Broadband Net ARPU Wireless Net ARPU 2013 2012 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Smart Postpaid 1,154 1,153 1,099 1,102 1,269 1,237 1,251 1,248 Smart Prepaid(1) 141 141 142 153 148 143 140 149 Talk 'N Text 87 87 82 85 102 100 93 93 Sun Cellular Prepaid 57 58 60 68 57 57 58 64 Sun Cellular Postpai

  24. Slide 24: Historical Consolidated: Service Revenues and EBITDA

    Historical Consolidated: Service Revenues and EBITDA 2013 2012 (Php in millions) 1Q 2Q 3Q 4Q FY 1Q 2Q 3Q 4Q FY Fixed line 11,997 12,275 12,220 12,589 49,081 12,067 11,835 11,765 11,964 47,631 Local exchange 4,008 4,066 4,042 4,057 16,173 4,146 4,089 4,059 4,063 16,357 International long distance 1,7

  25. Slide 25: Historical Wireless: Service Revenues & EBITDA

    Historical Wireless: Service Revenues & EBITDA 2013 2012 (Php in millions) 1Q 2Q 3Q 4Q FY 1Q 2Q 3Q 4Q FY Wireless Gross Service Revenues Cellular services 25,709 26,529 26,040 27,597 105,875 25,884 25,776 25,428 26,516 103,604 Cellular Voice 12,187 12,869 12,733 13,595 51,384 12,493 12,207 12,175 12

  26. Slide 26: Historical Fixed Line: Service Revenues and EBITDA

    Historical Fixed Line: Service Revenues and EBITDA 2013 2012 (Php in millions) 1Q 2Q 3Q 4Q FY 1Q 2Q 3Q 4Q FY Fixed Line Gross Service Revenues Local exchange 4,036 4,092 4,066 4,080 16,274 4,174 4,115 4,089 4,092 16,470 International long distance 2,968 2,802 2,678 2,974 11,422 2,810 2,479 2,661 2,8

  27. Slide 27: Earnings Per Share

    Earnings Per Share FY2013 FY2012 (audited) (as adjusted) Basic Diluted Basic Diluted Net income (loss) attributable to equity holders of PLDT 35,420 35,420 36,148 36,148 Continuing Operations 33,351 33,351 35,605 35,605 Discontinued Operations 2,069 2,069 543 543 Dividends on preferred shares (60) (

  28. Slide 28: Cash Flows

    Cash Flows FY2013 FY2012 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (audited) (as adjusted)* Net cash from operations 50,601 29,869 3,155 73,763 80,370 -8% Add(Deduct): Capital expenditures (17,092) (11,746) - (28,838) (36,396) -21% Other investing activities (18

  29. Slide 29: Balance Sheet

    Balance Sheet Consolidated December 31, 2013 December 31, 2012 (Php in millions) (Audited) (Audited) Total Assets 399,638 405,815 Nominal Value of Total Debt 104,472 117,115 in US$ $2,353 $2,851 Less: Unamortized Debt Discount 382 1,323 Total Debt 104,090 115,792 Cash and short-term investments 32,6

  30. Slide 30: Debt Profile

    Debt Profile (US$ in millions) 2006 2007 2008 2009 2010 2011(1) 2012(1) 2013(1) Debt Balance 1,756 1,585 1,625 2,210 2,113 2,719 2,851 2,353 Cash and short-term investments 514 745 847 908 852 1,061 919 735 Net Debt 1,242 840 778 1,302 1,261 1,658 1,932 1,618 (1) Including Digitel Debt Maturities as

  31. Slide 31: Interest-bearing Liabilities

    Interest-bearing Liabilities December 31, 2013 December 31, (Audited) 2012 Unamortized Debt Change Carrying (Audited) Discount/Debt Face Value Value Face Value (US$ in millions) Issuance Debt PLDT $1,282 $2 $1,284 $1,440 ($156) Smart $805 $7 $812 $957 ($145) DIGITEL $257 $ - $257 $454 ($197) Others

  32. Slide 32: 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

  33. Slide 33: 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

  34. Slide 34: DIGITEL

    DIGITEL The future is in our Fiber. = a2 I Ooo )

PLDT — FY2013 Earnings Presentation on 6ix