Globe Telecom: Fitch Ratings forecast in line with company outlook

Posted in Globe Telecom, Inc., Telecommunications | October 10, 2014 - 12:00pm

Globe Telecom will continue to lead the industry in terms of revenue growth on expectations of steady subscriber increase amid robust demand for data connectivity on growing customer preference for the use of data-capable mobile devices.

“Our strategy to be the network of choice for smartphone users in the Philippines seems to be working very well and the company continues to attract customers amid the popularity of data-driven applications. This will continue to underpin our revenue growth prospects for the rest of the year and the next,” said Globe President & CEO Ernest Cu. 

Cu’s statement supports Fitch’s forecast that Globe Telecom’s revenue growth will be faster than competition’s. “Competition is intense in the data segment as both telcos continue to offer handset subsidies and are only gradually migrating to volume-based tariffs from unlimited tariffs. Globe’s revenue is likely to rise by mid-single digits in 2015, greater than PLDT’s growth; given it has a higher proportion of smartphone users,” Fitch said.

According to Cu, Globe’s recent decision to re-introduce its free Facebook promo is intended to enable more Filipinos to gain internet connectivity without any cost, which has proven to be an effective business strategy. Globe Telecom’s  revival of its Free Facebook promo immediately follows another milestone in the telecommunication company’s network transformation as it completed end September the activation of 4G HSPA+ technology in all of its cell sites.

Globe is the first telecommunications company in the world to provide Free Facebook access to its mobile customers, which introduced mobile browsing to many Filipinos. The offer, which began in October last year, ran for about six months.  Following the expiration of its initial Free Facebook promo, Globe said the offer helped boost its mobile data revenues. At the end of the first half, the company’s customer base reached a record high of 45 million, a 19% jump from 37.9 million a year earlier, courtesy of substantial customer uptake in its mobile and broadband businesses.

The company also reported that at the end of the first half of the year, its mobile browsing and other data revenues jumped 11% to reach P6.2 billion from P5.6 billion a year earlier. The growth was attributed mainly to continuous demand for data services.

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    Ms. Yoly C. Crisanto
    Head, Corporate Communications
    Globe Telecom, Inc.
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