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PLDT first half profit drops 29% to P11.7B

PLDT Inc. saw its net income plunge by 29 percent in the first half, given the absence of asset sales that lifted its bottomline a year earlier.

The telco giant reported P11.7 billion in profits for the January-June period, lower compared to P16.5 billion recorded in the comparable 2017 period.

The result was muted “due to higher gain from asset sales last year,” PLDT Chief Financial Officer Annabelle Chua said during a briefing on Thursday.

A year earlier, PLDT was able to sell a major stake in Beacon Electric Asset Holdings Inc. and Manila Electric Co. (Meralco) to sister company Metro Pacific Investments Corp. for P43.6 billion.

Consolidated expenses also rose 7 percent to P67.4 billion from a year earlier due to “higher depreciation and amortization,” PLDT said in its quarterly report.

The telco’s shares fell by P3 or 0.22 percent to P1,347 at the end of the day amid a wider market drop of 0.39 percent.

Manuel Pangilinan, PLDT chairman, president and CEO, said the company had “stayed on the growth path” given gains in its Home and Enterprise business.

“Life, however, has become even more complicated,” he noted, citing developments such as a Labor department order—recently modified by an appellate court—to regularize over 7,300 contractual employees.

“Despite these headwinds, the favorable factors for our continued recover remain in place,” Pangilinan said, with PLDT sticking to its 2018 capital expenditure budget of P58 billion and full-year profit guidance of P23-24 billion.

The telco has already used up P21.8 billion of this year’s “historic” capex, he said.

The company’s consolidated service revenues rose by 2 percent to P72.5 billion for the first half under a new accounting standard adopted at the start of the year. The gain would have been 4 percent under the previous standard, PLDT noted.

Consolidated earnings before interest, taxes, amortization and depreciation were 4 percent higher at P33.2 billion, with the Home and Enterprise businesses notching 14 percent and 9 percent gains, respectively.

Excluding unit Voyager Innovations, core income rose by 6 percent to P13 billion, PLDT said. With Voyager, core income was 1 percent lower at P11.7 billion.

Pangilinan also said that the telco had enticed a new group of investors, which he did not identify, to invest in Voyager following unsuccessful talks with China’s Tencent.

“From our standpoint, it will be a partnership with these foreign investors in Voyager. PLDT is likely to remain the single largest investor in Voyager, but the foreign investors, as a group, would like to take a majority position,” he added.

This will “reduce the quantum of losses we will book moving forward using the loss of Voyager in the first six months, which is P1.3 billion,” Pangilinan noted.

He said “much more than a billion” would be infused into Voyager under the partnership, helping the unit expand over the next three to four years.

PLDT also announced that its board had approved an interim dividend of P35 per share in line with a 60 percent payout policy. The dividend for stockholders on record as of August 28, 2018 will be payable on September 11, 2018.

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