Globe expects steady growth for 2023 despite Q3 income decline

GLOBE Telecom, Inc. still anticipates ending the year with a “steady growth” performance despite ending the third quarter (Q3) with a 27% decline in third-quarter attributable net income, the company’s top official said.

“We are quite pleased with how the business has shaped up this year, considering interest rates [and] inflation have been going up and down. It shows that our integrated telco model, which includes mobile and fixed line actually is an indicator of strengthened [business] that we are able to leverage both product lines during this challenging economic time,” Ernest L. Cu, president and chief executive officer of Globe, said in a virtual press briefing on Monday.

He said these indicators “will help us deliver steady growth.”

For the third quarter, the listed telecommunications company recorded an income of P4.97 billion, 27% lower than the P6.81 billion a year ago, amid higher non-operating charges for the period, its financial statement showed.

It posted consolidated revenues of P44.27 billion in the quarter, 3.2% higher than P42.88 billion a year ago, amid strong service revenues.

Service revenues, which amounted to P40.66 billion, accounted for the majority of the company’s third-quarter top line, rising by 4% year on year from P39.1 billion. Meanwhile, its non-service revenues declined by 5% to P3.61 billion from P3.80 billion previously.

Higher expenses pulled down the company’s bottom line in the period. Costs and expenses climbed by 4.2% to P38.87 billion in the third quarter, up from P37.30 billion a year ago.

The company said it also expects growth to be driven by its shift to a tech-centric business, Mr. Cu said, adding that Globe Fintech Innovations, Inc. (Mynt) is expected to fuel the company’s optimistic projection.

Mynt is the operator of Globe’s electronic wallet platform GCash, which accounted for about 6% of the company’s net income for the nine months to September.

“Mynt, the Globe Group’s fintech arm, has continued its upward trajectory. Being the preferred mobile wallet in the Philippines, GCash continues to empower more Filipinos with digital financial tools and services which led to its growth in users and profitability,” Globe said in a separate statement released on Sunday.

It said that the company’s share in Mynt’s equity earnings totaled P1.6 billion or about 6% of the company’s net income before tax for the nine months to September.

Further, it said that its mobile business recorded a 3% growth due to higher mobile data consumption for the period.

From January to September, Globe’s attributable net profit fell by 27.1% to P19.29 billion from P26.46 billion in the same period last year.

Its consolidated revenues stood at P133.79 billion, 2.8% higher than the previous year’s P130.20 billion.

Revenues from services made up the bulk of the total at P121.1 billion, up by 2.7% from P117.96 billion last year, which it described as a record high.

At the local bourse on Monday, shares in the company closed unchanged at P1,762 apiece. — Ashley Erika O. Jose