GLOBE GROUP POSTS SOLID 4Q AND FULL YEAR RESULTS: 

RECORD REVENUES AT ₱158.0 BILLION, UP 4% YoY; 

RECORD EBITDAAT ₱79.1 BILLION, UP 6% YoY; 

NIAT AT ₱34.6 BILLION, UP 46% YoY; AND, 

NORMALIZED CORE NIAT AT ₱19.2 BILLION, UP 1% YoY

NON-TELCO REVENUES SUSTAIN GROWTH MOMENTUM AT 106% YOY; MOBILE BUSINESS REVENUES AT ₱107.5 BILLION, UP 3% YoY, DRIVEN BY RECORD MOBILE DATA REVENUES OF ₱83.8 BILLION, UP 8% Y OY; 

CORPORATE DATA REVENUES REACH RECORD ₱17.2 BILLION, UP 21% Y OY 

FULL YEAR 2022 CAPEX UP 9% YoY AT ₱101.4 BILLION (US$1.9 BILLION); CAPEX GUIDANCE OF US$1.3 BILLION IN 2023, 30% LOWER YoY VERSUS PEAK LEVEL, AND TARGETS US$1 BILLION BY 2024; 

FOCUS ON BRINGING THE COMPANY BACK TO MORE SUSTAINABLE FREE CASH FLOW LEVELS 

FIRST IN SEA: GLOBE PILOTS NEW LENS ANTENNA TECHNOLOGY 

FOR BETTER CUSTOMER EXPERIENCE 

GLOBE HAILED PH’S BEST MOBILE NETWORK INFRASTRUCTURE COMPANY AT GLOBAL BUSINESS OUTLOOK AWARDS 2022 

GLOBE RECEIVES PRESTIGIOUS 5 GOLDEN ARROW AWARD 

FOR CORPORATE GOVERNANCE AT THE 2022 GOLDEN ARROW AWARDS

Key Financial Highlights: Robust Topline Growth as Data Uphill Trend Continues 

The Globe Group closed the year with all-time high consolidated service revenues reaching ₱158.0 billion, up 4% year-on-year. Corporate data and mobile services, complemented by the continuous growth from non-telco services, mainly drove the topline expansion as more Filipinos adopt the digital lifestyle. Total data revenues as a percentage of total consolidated service revenues increased to 81% from 80% last year. 

The mobile business sustained its upward performance, ending the year with ₱107.5 billion compared to ₱104.4 billion reported the previous year and the second highest in company history. The revenue improvement came mostly from prepaid with greater public mobility and the resumption of face-to-face classes and work. Total mobile revenues comprised 68% of the total service revenues, with the total mobile customer base ending at 86.7 million in 2022. 

From a product perspective, mobile data revenues posted a record ₱83.8 billion for the full year of 2022 or 8% higher versus ₱77.8 billion in 2021. Mobile data traffic likewise soared to 4,658 petabytes as of end-December of 2022, surpassing the 3,733 petabytes reported in the preceding year. Mobile data now accounts for 78% of mobile revenues from 75% last year. On the other hand, mobile voice and mobile SMS revenues ended at ₱14.9 billion and ₱8.8 billion, lower year-on-year by 13% and 5%, respectively. 

With Globe’s expanded fiber footprint, postpaid fiber subscribers and revenues posted a year-on-year increase of 35% and 84%, respectively. The increasing fiber adoption among Globe customers drove the continued migration of home prepaid wifi (HPW) subscribers to fiber. However, this increase in fiber revenues was not enough to cover the decline in the legacy businesses, as the Home Broadband business further declined in the fourth quarter, ending the year at only ₱27.1 billion from ₱29.4 billion a year earlier. Similarly, total Home Broadband subscriber count now stands at 2.6 million or down by 30% year-on-year, with HPW data traffic declining to only 450 petabytes as of end-December 2022 from 808 petabytes a year ago. 

Despite the performance of the fiber business, the addressable postpaid fiber market has reached saturation levels with the wider market remaining underserved. Public clamor for reliable and more importantly, affordable internet connectivity continues. In response to this, Globe has shifted its focus to prepaid fiber, which it believes will open the industry to a new segment that could potentially drive the next phase of growth for the Home Broadband industry. One such prepaid offering is TMBayan Fiber WiFi, a public WiFi service where subscribers can connect their devices and have access to the internet. With this service, sari-sari stores, town plazas, community centers and other neighborhood convergence areas can become WiFi hotspots. As of end-January 31, 2023, Globe has fired up 652 TMBayan Fiber WiFi hubs in the National Capital Region (NCR); Luzon including Bulacan, Pampanga, Cavite, and Laguna; Visayas, specifically, Cebu and Tacloban; and Mindanao, including Davao del Norte, Davao del Sur, and Zamboanga. Globe expects to launch even more prepaid fiber products into the market by the 2nd quarter of 2023, to complement its current fiber offering. 

Corporate Data on the other hand, posted an all-time high revenue of ₱17.2 billion or 21% increase from a year ago due to the strong traction from information and communication technology (ICT) services which grew 89% year-on-year as more companies rely on business application, cloud, and data center services. 

As Globe continues to expand its beyond telco initiatives with a growing portfolio of digital companies in spaces such as fintech, healthtech, adtech, and entertainment, its non-telco revenues jumped to ₱4.2 billion in 2022 from ₱2.0 billion last year. The substantial revenue contributions from ECPay, Yondu, and Asticom led to its outstanding performance in 2022. 

Total operating expenses including subsidy stood at ₱78.9 billion for the full year of 2022, or 2% higher from a year ago. 2022 was a challenging year with several macroeconomic and external factors causing almost all expense line items to increase. These increases were partially offset by the declines from lease, services, marketing and subsidy, due to cost management initiatives employed by the company. 

Full year 2022 consolidated EBITDA stood at a record ₱79.1 billion or 6% higher from 2021 with the topline expansion of 4% offsetting the growth in operating expenses (including subsidy). This enabled overall EBITDA margin to increase to 50% from last year’s 49%, in line with full year guidance. With the EBITDA expansion and this year’s non-operating income, which fully covered for the 11% increase in depreciation charges, net income reached ₱34.6 billion or up by 46% than the ₱23.7 billion reported in 2021. 

Total non-operating income of ₱10.7 billion as of end-December of 2022 was attributed to the one-time net gain of ₱8.4 billion (post-tax) on the partial sale of Globe’s data center business reported in the first quarter of 2022 and the net gain of ₱6.2 billion (post-tax) from the sale and leaseback of its tower assets. Excluding these one-time gains, normalized net income would have been ₱20.0 billion, or up by 13% year-on-year. 

Accordingly, core net income, which excludes the impact of non-recurring charges, and foreign exchange and mark-to-market charges, ended at ₱19.2 billion for the period versus the ₱21.2 billion from the year earlier. Similarly, normalized core net income was 1% higher from last year. 

On the back of several initiatives executed by the company in 2022, the balance sheet has remained healthy and gearing comfortably within bank covenants despite all the headwinds that materialized in 2022 and debt increasing from ₱210.1 billion as of end-December 2021 to ₱233.2 billion this period. Globe’s gross debt to equity is at 1.53x while gross debt to EBITDA is at 2.35x; Net debt to equity ratio is at 1.43x while net debt to EBITDA is 2.20x; and debt service coverage ratio is at 3.82x. 

“Despite 2022 being a challenging year marked by inflationary pressures, high interest rates and weakened consumer confidence, Globe once again showed resilience. We are happy that the Globe Group closed the year with strong topline and EBITDA growth. We also achieved momentous milestones in 2022 where we closed the country’s largest-ever tower sale and leaseback agreement. In addition we successfully concluded our first stock rights of er in over two decades and raised ₱17 billion despite challenging market conditions. 

As we strive to future proof our network performance, provide better customer experience, and continue with various digital innovations to address the everyday pain points of our fellow Filipinos, we are optimistic that our beyond-telco initiatives will help enable the Philippines to become a truly digital nation.” Ernest L. Cu, President and CEO of Globe Telecom Inc., stated. 

Key Business Highlights: Capex peaked in 2022 at ₱101.4 Billion (US$1.9 Billion) or 9% YoY to improve its data infrastructure 

Globe’s capital expenditure (capex) closed the year at ₱101.4 billion or 9% above than last year, which marked the highest investment ever in its mobile and fixed network to provide world-class internet experience for Globe customers nationwide. Majority or 86% of this period’s total cash capex was allocated for data requirements to ensure that customers will have access to more relevant digital solutions and best-in-class connectivity wherever they are. Globe spent record-high levels of capex in the past several years with its aggressive builds towards a #1stWorldNetwork and now have a significant backbone for its network. Through its strict and clear governance processes, Globe has ensured proper deployment of capital over the last few years, which allows it now to focus towards capital efficiency and optimization. This will bring capex in 2023 down to $1.3 billion, a reduction of over 30% from the 2022 peak level, with the target of eventually bringing this down to $1 billion by 2024. Through this, Globe aims to bring free cash flow back to more sustainable levels moving forward, as it reaps the benefit of the opportunistic investments it made in its infrastructure the past few years. 

Moreover, Globe deployed over 1.4 million fiber-to-the-home lines in 2022 versus 1.45 million lines from a year ago to address the growing need for connectivity nationwide as the economy opens up and mobility improves. For 2023, Globe will be shifting its focus to maximizing the utilization of its fiber inventory, and ensuring delivery of the right product to the underserved prepaid fiber market. 

Additionally, Globe built 1,702 new cell sites (vs. 1,407 in 2021), upgraded around 13.6 thousand mobile sites to LTE, and installed 2,267 new 5G sites nationwide to connect more consumers and businesses with the accelerated digitalization needs brought about by the pandemic. 

Globe, a 5G pioneer in the Philippines, is helping drive the adoption of 5G technology in the country and paves the way for the next generation of digital innovation. Globe’s 5G outdoor coverage has now reached 97.2% of the National Capital Region and 90.2% of key cities in Visayas and Mindanao. The company ended 2022 with 5G connectivity in 70 cities and towns across the Philippines versus 29 in 2021, more than doubling its coverage in a year. Globe also logged over 3.9 million devices in its 5G network in December of 2022. 

Moreover, with the Company’s ongoing network investments to provide our customers with superior experience, Globe has been named the Best Mobile Network Infrastructure Company at the annual Global Business Outlook Awards 20221. This recognition follows last year's award for Most Innovative Telecom. Globe’s continuous network buildup and improvement is part of Globe’s commitment to the United Nations Sustainable Development Goals, particularly UN SDG No. 9, highlighting the roles of infrastructure and innovation as crucial drivers of economic growth and development.