PLDT: Earnings ‘unaffected’ by P48-B budget overspend

Philippines largest telecommunications company PLDT Inc. said Thursday that its earnings this year are shielded from the recent discovery of P48-billion in capital expenditure (CapEx) overspending.

In a disclosure to the Philippine Stock Exchange, the Pangilinan-led telco giant said its earning before interest, taxes, depreciation, and amortization (EBITDA) and core telco earnings are not affected by the CapEx overrun issue.

PLDT issued the statement following the conduct of a special briefing on December 21 in Makati City, where its top management led by chairman Manuel Pangilinan, president and CEO Alfredo Panlilio, and chief legal counsel Marilyn Victorio-Aquino assured fund managers, investment analysts, and bankers that the telco’s business overall remains healthy and robust even as it continues to address its elevated CapEx spend and undergoes a comprehensive process review.

“Pangilinan said in particular that PLDT’s EBITDA for 2022 will remain unaffected by the CapEx overrun and is on track to hit P100 billion as originally indicated, with telco core net income expected to reach between P32.6 billion to P33 billion as guided,” the company said.

Moreover, PLDT said it expects to be able to pay the balance of the regular dividend for the full year 2022 estimated at P45 per share; and the remaining special dividend of P42 per share.

This would bring total dividends for 2022 to P134 per share or 88% of 2022 expected earnings, it said.

Pangilinan, during the briefing, said PLDT’s ongoing review thus far has uncovered no fraud, no anomalies, no evidence of overpricing, and no unrecorded transactions in relation to the overrun, according to the telco.

“The bulk of the P48B CapEx overspend involves the procurement of network equipment necessary to provide stronger connectivity to subscribers, specifically 5G cell sites for our mobile network and fiber rollout. There will be no write-off of these assets,” said Pangilinan.

On Wednesday, PLDT reiterated that its internal probe on the P48-billion capital expenditure overrun or budget overspend has not uncovered fraud as it cooperates with the inquiries being conducted by capital markets regulators.

Last Friday, PLDT announced it was investigating an estimated P48-billion worth of capital expenditure overrun or unexpected incurred budget costs over the period of four years (2019 to 2022), which triggered a management reorganization within the company.

The telco, however, said that its investigation has, so far, not uncovered any fraudulent transactions, procurement anomalies, or loss of assets arising from the capex overspend.

Despite the budget overrun, PLDT has said that all three of its major revenue streams—wireless, home, and enterprise— “remain healthy and robust.”

“These three business units are unaffected by the CapEx overrun,” it said.—AOL, GMA Integrated News