Globe Telecom (GLO) Q3 2024 earnings summary

Executive summary

• Gross service revenues for the first nine months of 2024 reached a record PHP 124 billion, up 4% year-on-year, with quarterly revenues at PHP 41.8 billion, driven by mobile and corporate data growth.

• EBITDA grew 8% year-on-year to PHP 64.9 billion, with a margin above 52%, exceeding guidance.

• Core net income after tax surged 22% year-on-year to PHP 17.6 billion, with normalized NIAT up 23%.

• Leadership transition announced: Carl Raymond Cruz appointed Deputy CEO effective January 2025, with succession to President and CEO planned for April 2025.

• Board approved a fourth quarterly cash dividend of PHP 25 per share, maintaining a sustainable dividend policy.

Financial highlights

• Mobile revenues hit a record PHP 87.7 billion for the nine months, up 5% year-on-year; mobile data revenues grew 9% to PHP 72.9 billion, now 83% of mobile revenues.

• Corporate data revenues grew 14% year-on-year to PHP 15.5 billion, led by ICT and business application solutions.

• Home broadband revenues declined 6% year-on-year to PHP 17.9 billion, mainly due to reduced fixed wireless services.

• Non-telco revenues dropped 56% year-on-year due to ECPay deconsolidation; Mynt (GCash) contributed 14% to pre-tax net income, with equity earnings up 114% year-on-year.

• Operating expenses (including subsidy) fell 2% to PHP 59.1 billion, reflecting cost-saving measures and ECPay deconsolidation.

Outlook and guidance

• Service revenues guided to low to mid-single-digit growth for 2024, with EBITDA margin guidance at 50%.

• CapEx expected to drop to $1 billion in 2024 and below $1 billion in 2025, with a target CAPEX-to-revenue ratio of 30%-35%.

• Free cash flow expected to further improve, turning positive by 2025 as capital allocation levers and sale-and-leaseback proceeds are realized.