Philippine Telephone Climbs to Five-Year High After Profit Boost
Philippine Long Distance Telephone Co. (TEL) climbed to a five-year high after profit at the nation’s most valuable company jumped sixfold.
Net income in the three months ended December climbed to 6.74 billion pesos ($166 million) from 1.08 billion pesos, taking full-year profit 12 percent higher to 35.5 billion pesos. The quarterly gain is the biggest since 2004, according to Bloomberg data.
Last year’s earnings reflect contributions from Digital Telecommunications Philippines Inc., the smaller rival purchased by the company known as PLDT in 2011 to help counter competition from Globe Telecom Inc. Chairman Manuel Pangilinan expects higher earnings this year and said “the bottom is likely to be behind us.”
PLDT rose 2.3 percent to 2,986 pesos at the close in Manila, the highest since Feb. 14, 2008. It has risen 18 percent so far this year, outpacing the benchmark stock index’s 15 percent gain.
Core profit, which excludes one-time gains and charges, may rise 3 percent to 38.3 billion pesos this year after falling 4 percent to 37.3 billion pesos in 2012, Pangilinan said.
“We take comfort from the fact that the first two months of 2013 have proven to be encouraging, with core profitability up,” Pangilinan told reporters today.
“Communication being an important tool in an election year should also boost earnings this year,” said First Grade Holdings Inc. Managing director Astro del Castillo.
The nation will hold elections for all local positions, the whole of Congress and half the Senate seats on May 13.
PLDT approved 5.5 billion pesos in investments by unit in media companies, it said today. Capital spending will decline to 29 billion pesos this year, below 20 percent of revenue, after completing its 67 billion-peso two-year network upgrade in 2012, he said.
Mobile-phone subscribers exceeded 72.5 million at the end of last month while broadband users reached 3.3 million as of end-2012, it said in the statement.
“In the first two months of this year we see the margins improving; we’re looking at better margins this year,” PLDT President Napoleon Nazareno said in the briefing.
PLDT declared dividends of 112 pesos a share, bring total 2012 payout to 172 pesos per share, equivalent to 100 percent of core income for a sixth straight year, it said.
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