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GLOBE MAINTAINS STRONG FINANCIAL RESULTS: FULL YEAR TARGETS REMAIN ON TRACK
RECORD SERVICE REVENUES AT ₱124.0 BILLION, UP 2% YoY; RECORD EBITDA AT ₱64.9 BILLION, UP 7% YoY;
EBITDA MARGIN AT 52%, TRACKING ABOVE GUIDANCE; NORMALIZED NIAT AT ₱17.8 BILLION, UP 20% YoY;
CORE NIAT AT ₱17.6 BILLION, UP 19% YoY;
MYNT'S IMPRESSIVE GROWTH DRIVES GLOBE'S NET INCOME BEFORE TAX, CONTRIBUTING A SIGNIFICANT 14%
RECORD MOBILE BUSINESS REVENUES AT ₱87.7 BILLION, UP 5% YoY, LED BY RECORD MOBILE DATA REVENUES OF ₱72.9 BILLION, UP 9% YOY; RECORD CORPORATE DATA REVENUES AT ₱15.5 BILLION, UP 14% YOY;
GLOBE'S STRATEGIC SHIFT TO PREPAID FIBER PAYS OFF WITH STRONG CUSTOMER ENGAGEMENT;
GLOBE SPENT CASH CAPEX OF ₱41.0 BILLION, DOWN 24% YoY, IN LINE WITH STRATEGY TO OPTIMIZE CAPITAL UTILIZATION AND ACHIEVE POSITIVE FREE CASH FLOW BY 2025;
GLOBE ATTAINS MSCI ESG “AA” RATING FOR TWO YEARS IN A ROW AND THREE-PEAT FIVE GOLDEN ARROW AWARD FROM THE INSTITUTE OF CORPORATE DIRECTORS
Key Financial Highlights: Data-Related Services Propel Substantial Revenue Growth
Globe1 closed the first nine months of 2024 with unprecedented heights in its consolidated gross service revenues, setting new quarterly and year-to-date records. The company achieved consolidated gross service revenues of ₱124.0 billion and ₱41.8 billion, higher by 2% year-on-year and quarter-on-quarter. These results were attained despite the ongoing normalization of home broadband and the impact of the ECPay deconsolidation. Mobile and corporate data businesses significantly contributed to this solid performance, accounting for a combined 83% of the total consolidated gross service revenues, up from
1 For purposes of this press release, Globe or the Company includes Globe Telecom, Inc. and its subsidiaries and affiliates.
80% the previous year. Mobile revenues rose 5%, and corporate data revenues grew 14% compared to the same period in 2023. Data revenues continued its robust momentum, accounting for 86% of consolidated gross service revenues, up from 82% last year. Assuming the deconsolidation of ECPay2 from Globe's books in the first nine months of 2023, to make the periods comparable, the total consolidated gross service revenues would have grown by 4%.
The mobile business posted a record ₱87.7 billion in revenues, surpassing its previous peak of ₱83.2 billion reported a year ago, showcasing improvements across all brands. The company's strategic market initiatives and ongoing network enhancements contributed to this record performance, ensuring that Globe's offerings remained competitive and appealing to customers. As a result, mobile revenues now account for 71% of the total consolidated gross service revenues, up from 69% in the same period last year. Moreover, Globe's mobile customer base expanded, reaching 60.2 million subscribers by the end of September 2024.
Mobile data revenues likewise surged to a record-breaking quarterly high of ₱24.8 billion, reaching a record ₱72.9 billion for the first nine months of 2024. This represents a 9% increase from its previous high of ₱67.0 billion reported a year ago. The upsurge in mobile data revenues was largely due to Filipinos' growing dependence on mobile applications for a wide range of online activities. Mobile data now accounts for a larger share of mobile revenues, growing from 81% last year to 83% this year. During this period, mobile data traffic increased to 4,843 petabytes from 4,360 petabytes reported in the corresponding period of 2023. Conversely, traditional mobile voice and SMS revenues declined by 5% and 13%, respectively, as consumers shift their communication preferences toward data-centric platforms.
During the nine-month period, the corporate data business achieved a record ₱15.5 billion in revenues, up 14% year-on-year. The overall growth was fueled by the 16% increase in Information and Communication Technology (ICT) and 13% surge in core data services. Business applications solutions (BAS) were the significant contributor to ICT revenue expansion, with 31% increase year-on-year. The company's dedication to providing customized digital solutions tailored to meet the needs of its enterprise clients propelled this outstanding performance.
In contrast, home broadband revenues were lower 6% year-on-year to ₱17.9 billion by the end of September 2024. This decrease was predominantly due to the reduction in fixed wireless services as consumers continued to move away from this technology into fiber products. This shift contributed to the resilience of fiber revenues, with a 2% year-on-year increase driven by strong demand for high-speed connectivity, which partially compensated for the overall softness in home broadband revenues.
Globe's fixed wireless revenue decline is gradually slowing down, aligning with the company's expectations. The increasing popularity of GFiber Prepaid (GFP) presents a promising growth opportunity for Globe's overall broadband revenues. As of the first nine months of 2024, GFP acquisitions surged by 52x compared to 2023. GFP continued to expand rapidly, achieving a subscriber base of 146,000 and demonstrating exceptional customer engagement, with reload rates reaching an all-time high of 81%. This growth reflects Globe’s effective customer acquisition strategy, with GFP acquisitions specifically doubling quarter-on-quarter, underscoring a robust market demand for flexible and affordable prepaid fiber services. Globe also implemented a strategic rightsizing of its broadband offerings, aligning its subscriber base with individual usage habits, which contributed to a 7% year-on-year increase in fixed-wired subscribers while optimizing focus on high-value customers. These results showcase Globe’s commitment to adapting its broadband strategy to meet the evolving needs of Filipino households.
2 The deal is currently undergoing thorough reviews. Completion is expected upon receipt of approvals from the relevant regulatory bodies and satisfaction of closing conditions.
The total home broadband subscriber base decreased by 3% in the current reporting period, from 1.75 million in the previous year to nearly 1.70 million. Additionally, HPW data traffic also dropped from 232 petabytes to 153 petabytes in the same period.
Globe's non-telco revenues dropped 56% year-on-year compared to the ₱4.1 billion reported at the end of September 2023. This substantial decrease was mainly due to the deconsolidation of ECPay from Globe's books following the sale of its 77% stake to Mynt. However, if this deconsolidation had been factored into Globe's records during the first nine months of 2023, the overall non-telco revenues would have been lower by only 15%.
Total operating expenses, including subsidy, fell 2% from ₱60.4 billion as of September 2023 to ₱59.1 billion in the current reporting period. This decline resulted from the company's ongoing cost-saving measures as well as the deconsolidation of ECPay. Reduced spending in various areas, such as marketing, provisions, repairs & maintenance and other expenses, contributed to this decrease. On a comparable basis, assuming ECPay's deconsolidation in Globe's books during the first nine months of 2023, the total operating expenses (including subsidy) would have been relatively flat year-on-year.
Consolidated EBITDA, rose a solid 7% compared to the previous year, achieving a record ₱64.9 billion. This improvement was driven by the 2% rise in consolidated gross service revenues, and the 2% reduction in operating expenses, including subsidy. Notably, the company's EBITDA margin showed remarkable resilience, maintaining a steady 52% since the first quarter of 2024, surpassing the full-year guidance of 50%.
Mynt, Globe's fintech arm, sustained its growth trajectory, solidifying its position as the dominant cashless ecosystem in the Philippines. GCash, the preferred platform for digital financial services, expanded its user base and profitability. Through GCash, Filipinos have gained access to a wide range of financial tools, empowering them in their financial journey. Globe's share in Mynt's equity earnings for the first nine months of 2024 soared to a record ₱3.5 billion, representing a 14% contribution to Globe's pre-tax net income, compared to 6% in the previous year. Mynt's equity earnings also outperformed prior year’s by a robust 114%.
Globe's net income posted a 6% increase from a year ago, registering ₱20.6 billion this period, from
₱19.4 billion the preceding year. This was primarily driven by the robust EBITDA growth, which negated the rise in depreciation expenses incurred during the period. Excluding the one-time gain from the tower sale, normalized net income would have stood at ₱17.8 billion, or up by 20% from the year earlier.
Additionally, excluding the impact of non-recurring charges, foreign exchange, and mark-to-market charges, Globe's core net income expanded by a solid 19% year-on-year, reaching ₱17.6 billion during the first nine months of 2024. On a comparable basis, assuming that ECPay had been deconsolidated from Globe's books during the first nine months of 2023, core net income would have grown by 22%.
Globe's balance sheet remained healthy, comfortably satisfying bank covenants. Total debt improved from ₱250.0 billion as of end-December 2023 to ₱240.9 billion this period. Globe's key gearing ratios for this period include Gross debt to EBITDA of 2.54x, Net debt to EBITDA of 2.30x, and debt service coverage ratio of 1.65x.
"Our unwavering resilience and agility have propelled us forward, leading us to extraordinary accomplishments. The robustness of our business model is evident in the impressive EBITDA we've achieved, along with a notable increase in Core NIAT during the first nine months of the year." said Ernest L. Cu, President and CEO of Globe Telecom Inc.
“With our country's digital economy poised for expansive growth, Globe is committed to empowering Filipinos across all economic segments. Our focus remains on unlocking value as a hyper-focused digital company, winning customers through network improvement and digital innovations while strengthening our core telco business.” Mr. Cu added.
Key Business Highlights: Globe's Sustainable Infrastructure Investment Strategy Leads to a 24% Decrease in Cash Capex
In the first nine months of 2024, Globe invested approximately ₱41.0 billion in capital expenditures (capex), a 24% decrease compared to the same period in 2023. Bulk of this amount or 91% was allocated for the data requirements to guarantee its customers with uninterrupted access to digital solutions and connectivity services, ensuring a seamless and consistent user experience. The cash capex to revenue ratio also declined from 45% in 2023 to 33% in the first nine months of 2024. This reduction is also in line with Globe's strategy to optimize capital utilization and achieve positive free cash flows by 2025.
From 2023 onward, Globe has strategically shifted its focus from opportunistic capacity expansion to optimizing existing network investments. This prudent approach has enabled the company to restore sustainable capital expenditure (capex) levels while maintaining network quality and capacity. As a result, purchase orders (POs) declined, representing only 53% of the actual cash capex during the first nine months of 2024. This reduction in PO issuances aligns with Globe's long-term objective of achieving a positive free cash flow position.
Globe's commitment to providing reliable and high-speed internet connectivity nationwide is demonstrated by its infrastructure expansion efforts. By the end of September 2024, Globe had built 684 new cell sites and upgraded 2,723 existing mobile sites to LTE technology. Additionally, Globe deployed 55,076 fiber-to-the-home (FTTH) lines to strengthen its fiber infrastructure. The rollout was strategically planned to maximize the utilization of existing fiber inventory, given the reduction in cash capex.
Over the first nine months of the year, Globe extended its 5G outdoor coverage by deploying 378 new 5G sites in different parts of the Philippines. In the National Capital Region, the 5G coverage now reached 98.51% and 94.91% in key cities in Visayas and Mindanao regions, respectively. This expansion resulted in approximately 106 towns now enjoying a robust 5G presence. Globe's success was further evident in September 2024 when the company registered over 8 million devices connected to its 5G network. Furthermore, Globe expanded its global presence by forging 5G partnerships with 133 inbound and 161 outbound global partners in 86 destinations, enhancing opportunities for seamless connectivity and collaboration.
The company’s consistent investment in network infrastructure aligns with its mission of ensuring equitable access and maximizing the potential of the digital economy for communities across the Philippines. These efforts to enhance and expand its network infrastructure align with the company's commitment to achieving the United Nations' Sustainable Development Goals, specifically SDG No. 9. This goal highlights the essential role of innovation and robust infrastructure as fundamental drivers of economic progress.
Recent Developments:
Tower Sale and Leaseback Deal:
●On July 23, 2024, Globe completed 100% of its Tower Sale and Leaseback Deal with Frontier Towers with the closing of the last batch of towers comprising 1,037 sites for a cash consideration of
₱13.17 billion.
●Subsequently, on October 28, 2024, Globe transferred an additional 25 towers to Unity, with a cash consideration of ₱300 million.
Overall, Globe has officially turned over 6,653 out of the 7,506 towers included in the Sale and Leaseback portfolio, generating approximately ₱85.5 billion in proceeds.
Typhoon Kristine:
●Network Restoration:
○Initial outages due to power failures affected 21 provinces in Southern Luzon and Visayas, impacting less than 13% of sites in Southern Luzon and 7% in the Visayas.
○Restoration began promptly in affected areas, with Globe prioritizing call, text, and data service restoration despite ongoing power issues.
○By October 25, service was fully restored in seven provinces, with efforts near completion in additional locations like Occidental Mindoro, Romblon, and Albay.
●Connectivity Relief for Affected Customers:
○Globe provided free connectivity options to affected customers, including:
■Free unlimited calls and texts, plus 100MB of data for all apps and an additional 100MB for social media, valid for a day.
■Eligible Globe At Home Prepaid WiFi users received free 5GB of data valid for three days and a three-day promo extension for GFiber Prepaid users.
■Extended payment due dates for Postpaid and GFiber Postpaid customers.
●Deployment of Emergency Stations:
○Globe set up "Libreng Tawag" (free calls), "Libreng Charging," and "Libreng WiFi" stations to support residents in heavily impacted areas.
○In Cebu City, a station was set up and operational for multiple days to aid local residents' communication needs.
●Community and Donation Efforts:
○Globe encouraged customers to contribute to relief efforts by donating their Globe Rewards points through the GlobeOne app, facilitating easier community assistance.
Product Update:
●Starting October 15, 2024, GFiber has revised its pricing structure, offering plans that range from
₱1499 per month for speeds up to 300 Mbps to ₱7,499 per month for speeds as high as 1.5 Gbps.
Data Center Update:
●STT Fairview Project:
○Construction is progressing on schedule; structural completion anticipated by the end of 2024.
○Operations will launch for initial customers in early 2025, with a full ramp-up to 12 MW IT load by end of 2025.
○Incorporates green technologies, making it one of the region’s most sustainable data centers.
●STT Cavite 2 Project:
○Active construction underway, with structural completion expected in early 2025.
○The site will be service-ready by late 2025, adding 6 MW of IT capacity.
●STT Cavite 2 Project, combined with STT Fairview, will raise total IT capacity from 22 MW to 52 MW by 2026. This expansion aligns with the company’s commitment to scale with market growth and client needs.
●Operational Performance:
○Achieved an 80% rack utilization rate, including contracted space, demonstrating operational efficiency and client trust.
Network Related Update:
●Globe has successfully upgraded 450 cities and towns across the Philippines to fiber-optic technology, strengthening its commitment to providing top-tier connectivity to its wireline
customers while promoting sustainability through energy-efficient, future-ready solutions. The migration, which entails replacing copper cables with fiber, covers towns and cities in at least 60 provinces across the country.
https://www.globe.com.ph/about-us/newsroom/corporate/globe-fiber-migration-450-cities
●Globe further strengthens its commitment to enhancing connectivity in Mindanao, building a new tower in Malaybalay City, and upgrading 16 sites across Bukidnon. The site upgrades were strategically implemented, with three each in Libona, Manolo Fortich, and Quezon; two each in Malaybalay City and Valencia City; and one each in Lantapan, San Fernando, and Maramag. https://www.globe.com.ph/about-us/newsroom/corporate/new-tower-malaybalay-city
●Globe has enhanced its digital infrastructure in Pangasinan, building four cell sites and upgrading 13 existing ones to support connectivity needs in the province, known for agricultural bounty and a burgeoning tourism industry. The new sites, built in Bayambang, Binalonan, Mangatarem, and San Manuel, aim to deliver robust mobile and internet connectivity throughout these strategic locations. https://www.globe.com.ph/about-us/newsroom/corporate/digital-infrastructure-pangasinan
●Globe continues to elevate its commitment to improving connectivity across the Philippines by firing up two new cell sites in Bogo City, Cebu. These installations are located in Brgy. Binabag and Brgy. Marangog, promising significant benefits for residents, businesses, and tourists alike, enhancing digital experiences and supporting local economic activities. https://www.globe.com.ph/about-us/newsroom/consumer/globe-expands-bogo-city-network
●Globe has installed a total of 20 new sites across four provinces in Central Luzon, aiming to boost the region’s digital infrastructure and support its predominantly agricultural economy and growing tourism sector. In Bulacan, Globe built six new towers: two in Marilao and one each in Angat, Doña Remedios Trinidad, Hagonoy, and the city of San Jose Del Monte. A total of 22 other sites were also expanded across the province. Six new towers were also recently built in Nueva Ecija, with one new site each in Aliaga, Gapan City, General Tinio, San Isidro, Santa Rosa, and Talavera. Globe also expanded 11 existing sites to ensure that both urban centers and rural communities gain access to faster, more reliable digital services. In Pampanga, Globe built five additional cell towers to provide better network coverage in Apalit, Floridablanca, Mexico, San Luis, and Sasmuan. In addition, 15 existing sites were upgraded to expand network capacity and coverage. Tarlac, meanwhile, got three new sites in Bamban, Concepcion and Tarlac City, with other sites also upgraded, further enhancing the province’s overall network coverage. https://www.globe.com.ph/about-us/newsroom/corporate/20-new-sites-central-luzon
●Globe has set up four new cell towers in Liloan, Cebu, boosting connectivity and digital access for local communities. Two of the towers are in Brgy. Tayud, a remote industrial area with limited connectivity. The other facilities are located in Brgy. San Vicente and Brgy. Yati.
○Brgy. Tayud, with 22,000 residents, stands to benefit immensely from this upgrade as it is far from the city center. The towers cover areas such as Tayud Barangay Hall, Corbox Corporation, Apollo's View, Amara, Gallardo's Venue, and Makaloka Beach Resort.
○Brgy. San Vicente has nearly 13,000 residents, while Brgy. Yati has 37,000 residents. The new towers in these barangays provide improved connectivity and can play a vital role in disaster preparedness and response due to the areas' vulnerability to flooding.
Residents of the three barangays now have easier access to the municipality's LiveLoveLiloan App, which offers various services like an online marketplace, emergency services, and an electronic transport system.
https://www.globe.com.ph/about-us/newsroom/corporate/4-new-cell-towers-liloan-cebu
●Globe has taken a significant stride in bridging the digital divide by installing new cell towers in three remote barangays of Cebu: Brgy. Ilihan, Brgy. Poblacion, and Brgy. Simala. These communities previously faced connectivity challenges due to their geography and limited infrastructure. With the new cell towers, Brgy. Ilihan, with its 3,818 residents, will have improved access to information and services, while Brgy. Poblacion, home to 12,573 residents and agricultural industries, will benefit from a stronger internet connection, boosting business growth. Brgy. Simala, renowned for its tourism and agriculture, will also experience enhanced internet services.
Globe’s efforts represent a significant step towards reducing the urban-rural digital gap, ensuring that even the most remote communities can participate in the digital economy. https://www.globe.com.ph/about-us/newsroom/corporate/new-cell-towers-cebu-remote-area
Key Portfolio Company Highlights: Non-Telco Revenues Plummet 56% as Share in Equity Earnings Soar 120% Year-on-Year
GCash remains the number one finance super-app and the largest digital cashless ecosystem in the country, bannered by ubiquity across its active user base. To complement its ubiquity across its consumers, GCash has also built the largest network of online and offline merchants and social sellers (over 6 million partners) while hosting over 1,000 merchant partners in its app, via GLife. Through the GCash App, customers can easily purchase prepaid airtime, pay bills nationwide, send and receive money anywhere in the Philippines, even to other bank accounts, and purchase from their partner merchants and social sellers.
Built on trust and the security of its brand and platform, GCash was recently recognized by the Asia-Pacific Stevie Awards for the Innovative Use of Technology in Customer Service and for Innovation in Digital Transformation. Alongside this, GCash was recognized by Pan Finance as the best mobile wallet in the Philippines in 2024, and was also given the Company of the Year Award for the Philippines’ Financial Technology Industry from leading global analysis and growth strategy consulting firm Frost & Sullivan. These awards recognize GCash’s pioneering use of digital solutions and innovative financial services and its strong overall achievements in the financial technology space.
GCash boasts of the most comprehensive suite of digital financial services, covering savings (via GSave), investments (via GFunds, GStocks, and GCrypto), and insurance products (via GInsure). On credit, backed by its proprietary trust platform and credit scoring via GScore, GCash has provided access to credit to over 6.9 million borrowers, of which the majority are from lower socio-economic classes and
⅔ are women. These milestones were achieved through game-changing lending products covering credit lines (GCredit), cash loans (GLoan), buy-now-pay-later (BNPL via GGives), and the newly-launched micro-credit starter loans (Sakto Loan and Borrow Load), providing loans to more Filipinos who need it the most.
In line with its financial inclusion mandate, GCash has gone beyond the nation’s borders and now offers payments in 51 countries through GCash Global Pay. In partnership with Alipay+, this feature offers a hassle-free travel experience abroad through a seamless and secure payment experience across various merchants through Scan to Pay. GCash also empowers overseas Filipinos in 16 countries to manage their finances through GCash Overseas, which allows them to use their international mobile number to register for the GCash App and gives them access to services such as Buy Load, Pay Bills, and Send Money.
Moving beyond transactions, GCash incorporates sustainability across its innovation initiatives. The GForest movement empowers users to accumulate green energy and plant trees by simply using GCash.
To date, more than 2.9M trees have been planted and 139K tonnes of carbon dioxide have been avoided, enabling our users to build a greener tomorrow.
Meanwhile, Globe’s corporate venture builder, 917Ventures portfolio companies includes telehealth service platform KonsultaMD and Brave Connective Holdings, Inc., which brings together under its umbrella the companies that will help businesses strengthen their connection with customers through the use of data, analytics, targeting, and storytelling.
Brave Connective Holdings, Inc. (BCHI)
○AdSpark, the award-winning and largest locally ad-based data powered digital media and creative agency which has launched more than 3,000 digital campaigns.
○M360, largest A2P multi-channel messaging platform, capable of sending messages to over 700 partner network operators in 190 countries via SMS or chat apps. Generates over 1.1 billion average monthly traffic with access to over 150 million mobile SMS users and over 45 million OTT users in the Philippines.
○DeepSea, enables programmatic advertising by leveraging first party data, millions of audiences and wide variety & unique audience segments to advertisers
○iNQUiRO, suite of data-driven products and solutions designed to create value for enterprises and their customers.
Key ESG Highlights: Promoting a Sustainable Tomorrow through Positive Impact on Society and the Environment
Globe’s Sustainability practice is anchored on Globe Purpose, “Uplift Filipino Lives Everyday”. By aligning with global sustainability frameworks, standards, and principles such as the United Nations’ Sustainable Development Goals (UN SDGs) and UN Global Compact and industry sustainability ambitions, the company is able to collaborate with its stakeholders to deliver positive societal and environmental impact. Globe is focused on addressing its material topics by scaling the integration of its sustainability practices within its business units, portfolio companies, and across the value chain.
Progress towards sustainability ambitions are disclosed in the Globe Sustainability website (https://www.globe.com.ph/about-us/sustainability.html) and in the annual Integrated Report (https://www.globe.com.ph/about-us/sustainability/integrated-report.html#gref). The 2023 Integrated Report is guided by the principles of the following frameworks:
●Reference to the Global Reporting Initiative (GRI) standards
●International Integrated Reporting Council (IIRC) Framework
●Sustainability Accounting Standards Board (SASB)
●Task Force on Climate-related Financial Disclosures (TCFD) recommendations
●United Nations Global Compact (UNGC) Principles
●United Nations Sustainable Development Goals (UN SDGs)
●Securities and Exchange Commission (SEC) recommendations
oIntegrated Annual Corporate Governance Report (i-ACGR)
oSustainability Reporting Guidelines
●GSMA ESG Metrics for Mobile
The annual integrated report is in compliance with the recommendations made in the Philippines SEC Memorandum Circular No. 4, series of 2019 on Sustainability Reporting for Publicly-Listed Companies (PLCs) and has undergone third-party external assurance for select sustainability metrics and GHG accounting conducted by DNV Business Assurance Singapore Pte. Ltd.
About Globe
Globe Telecom, Inc. is a leading digital platform in the Philippines, with major interests in telecommunications, venture capital and venture building, shared services and digital marketing solutions. The company serves the telecommunications and technology needs of consumers and businesses across an entire suite of products and services including mobile, fixed, broadband, data connectivity, internet and managed services. In 2019, Globe became a signatory to the United Nations Global Compact, committing to implement universal sustainability principles. Its principals are Ayala Corporation and Singtel, acknowledged industry leaders in the country and in the region.
It is listed on the Philippine Stock Exchange under the ticker symbol GLO and had a market capitalization of US$5.9 billion as of the end of September 2024.
For more information, visit www.globe.com.ph. Follow @enjoyglobe on Facebook, Twitter, Instagram and YouTube.
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