The Globe Group closed the first three months of the year with consolidated service revenues reaching 40.0 billion, up 2% from the same period last year despite all the macroeconomic headwinds. The continued topline growth was mainly fueled by the steady rise in data revenues, which grew in step with the increasing use of technology and digitalization in work, business, and other aspects of daily life among Filipino consumers. Total data revenues as a percentage of consolidated service revenues rose to 82% from 81% last year.
Mobile business revenues as of end-March 2023, stood at 27.1 billion or higher by 1% compared to 26.9 billion reported a year ago. The revenue improvement came mostly from the company’s prepaid brands, as the impact of public mobility returning to normal cushioned the downward pressures of the economic environment to consumer’s wallets. Total mobile revenues comprised 68% of the total service revenues, with the total mobile customer base ending at 84.2 million for the first three months of the year.
From a product perspective, mobile data revenues posted a record 21.7 billion forthe first three months of the year or 4% higher than the 20.8 billion posted in 2022. Mobile data traffic likewise soared to 1,352 petabytes as of end-March of 2023, surpassing the 1,058 petabytes reported in the preceding year. This was largely driven by the increasing mobile data habituation levels among our subscriber base. Mobile data now accounts for 80% of mobile revenues from 78% a year earlier. On the other hand, traditional mobile voice and SMS revenues ended at 3.4 billion and2.0 billion, lower year-on-year by 12% and 7%, respectively.
The Home Broadband business ended the first quarter of 2023 with 6.5 billion revenues from 7.0 billion a year ago. This decline was still largely due to the continued reduction in the legacy and fixed wireless products, which was partly offset by the improvements seen in postpaid fiber subscribers and revenues, registering a year-on-year increase of 20% and 30%, respectively.
The total Home Broadband subscriber count now stands at 2.3 million or down by 33% year-on-year, given the changing dynamic of the industry, with HPW data traffic declining to only 86 petabytes as of end-March 2023 from 138 petabytes recorded in 2022.
With the postpaid broadband segment already saturated, Globe has shifted its focus to delivering home fiber connectivity via a prepaid proposition, which will be launched in the second quarter of 2023. Last year, Globe initially launched TMBayan Fiber WiFi, a prepaid public WiFi service where subscribers can connect their devices and have access to the internet. With this service, Globe is converting sari-sari stores, town plazas, community centers and other neighborhood convergence areas into WiFi hotspots, expanding internet accessibility and improving the connectivity experience of customers.
Corporate Data on the other hand, generated 4.5 billion revenues this period or 15% increase from the same period a year ago. This was mainly due to the strong traction from information and communication technology (ICT) services which grew 52% year-on-year as enterprise digitalization continues to gain momentum.
As Globe continues to accelerate its pivot from a traditional telecommunications company to a full-fledged tech enterprise (or from telco to techco), its non-telco revenues soared to 1.4 billion this period from 791 million in the first quarter last year. This steady rise in revenues was powered by the outstanding performance of ECPay, Yondu, and Asticom.
Total operating expenses including subsidy as of end-March 2023 amounted to 19.5 billion, or flat year-on-year following Globe’s cost management initiatives.
Consolidated EBITDA improved by 4% year-on-year from 19.7 billion to 20.5 billion this period due to the 2% topline expansion and flat operating expenses (including subsidy). This enabled overall EBITDA margin to increase to 51% from last year’s 50%.
However, this period’s EBITDA growth was fully offset by lower non-operating income and the slight increase in depreciation, leading to a net income of 7.3 billion for the quarter, a 47% decline against the 13.7 billion reported in the same period of 2022.
Total non-operating income for the period stood at 395 million or a 95% decline from the year earlier, due to the one-time net gain of 8.5 billion (post-tax) reported last year related to the partial sale of Globe’s data center business. Excluding this one-time gain, normalized net income would have been 5.1 billion, or flat year-on-year.
Accordingly, core net income, which excludes the impact of non-recurring charges, and foreign exchange and mark-to-market charges, ended at 5.1 billion for the period or flat year-on-year.
Globe’s balance sheet remained healthy and gearing comfortably within bank covenants despite the slight increase in debt from 233.2 billion as of end-March 2022 to 234.5 billion this period. Globe’s gross debt to equity is at 1.50x while gross debt to EBITDA is at 2.54x; Net debt to equity ratio is at 1.40x while net debt to EBITDA is 2.37x; and debt service coverage ratio is at 3.44x.
“We are encouraged by the results in the first three months of the year with healthy topline and EBITDA growth amidst high inflation, interest rates and other economic challenges. Our mobile business remains fundamentally strong given the success of the programs that we have implemented empowering our customers to thrive in today’s fast-paced digital landscape. We are likewise upbeat and optimistic about the growth prospects of our digital solutions platforms, which posted successive quarters of significant revenue gains. We believe that we are well-positioned to sustain this business momentum, and unlock new areas of growth as we strive to future-proof our network, provide better customer experience, and continue with various digital innovations to achieve a better life for our fellow Filipinos.” Ernest L. Cu, President and CEO of Globe Telecom Inc., stated.
Update on Globe SIM Registration:
As of May 2, 2023, 43.242 million Globe customers have registered their SIMs out of the total 86.7 million subscriber base as of December 31, 2022. SIM registration is mandated by the Philippine government under Republic Act 11934 or the SIM Registration Act. The law was enacted to combat online scams, fraud, and other forms of cybercrime.
Globe customers may register via https://new.globe.com.ph/simreg website and GlobeOne app. In addition to these online channels, Globe’s 147 stores and 25 EasyHubs across the country are open for customers who need help registering their SIMs. Since January 2023, Globe has been regularly joining SIM Registration Assistance initiatives led by the National Telecommunications Commission to help customers in remote locations. Globe also works with various local government units, groceries, and shopping malls to set up assisted registration booths in various sites to aid seniors, PWDs, pregnant women, and those with limited internet access, or are using basic phones.
The company applauds the government led by the Department of Information and Communications Technology (DICT) for extending the SIM registration deadline, giving millions of unregistered customers more time to comply with the law. Unregistered SIM users have until July 25 to complete their SIM registration. Globe urges its subscribers to quickly take advantage of the extended time and not wait for the last minute to register to avoid deactivation of their SIMs.
Network related Updates:
- The country’s longest submarine cable network has now reached the shores of Zamboanga and is on track for completion in April as planned. Globe, together with partners Eastern Communications and InfiniVAN Inc., is working to improve the existing telecommunications infrastructure in Zamboanga City by landing its first submarine fiber optic cable through the $150-million Philippine Domestic Submarine Cable Network (PDSCN) project.
PDSCN aims to lay 2,500 kilometers of fiber cables across key points in the country to improve both mobile and broadband connectivity, particularly in unserved and underserved areas. The project kicked off in Subic Bay, Zambales on July 14, 2022, and has successfully reached 33 landing sites nationwide. Before arriving in Zamboanga City, the subsea cable connection passed through Kinoguitan in Misamis Oriental and Camiguin Island.
- Leading digital solutions platform Globe started 2023 on a high, emerging as the Most Reliable Mobile Network in the Philippines for the fourth straight quarter, according to the global leader in fixed broadband and mobile network testing applications, Ookla.
Key ESG Highlights
Sustainability at Globe is anchored on its Globe Purpose, “In everything we do, we treat people right to do a Globe of Good,” and aims to contribute to 10 United Nations’ Sustainable Development Goals (UN SDGs) guided by the 10 UN Global Compact Principles.
In 2019, Globe became a signatory to the United Nations Global Compact, committing to implement universal sustainability principles.
Globe’s Sustainability practice is anchored on its Purpose that “in everything we do, we treat people right to create a Globe of Good.” With Globe’s nationwide footprint, it drives sustainability not just in its operations but also for society at large. The company is committed to contribute towards nation-building by providing inclusive digital products and services driven by its empowered workforce and stakeholders.
1Q 2023 Sustainability Updates
Globe has partnered with Global Electric Transportation (GET) to launch electric-powered shuttles for its employees this January to reduce fuel consumption and greenhouse gas (GHG) emissions from its fleet vehicles. To commemorate this partnership, GET initially provided Globe with two electric vehicles (EVs) to serve as employee shuttles.
In a drive to reduce the use of fossil fuel in the country’s transportation industry, Globe’s 917Ventures and Ayala Corporation have brought into the country an initial batch of Gogoro Smartscooters, batteries and swapping stations in preparation for its rollout of a sustainable transport system. An initial batch of 100 Smartscooters, 400 smart batteries and seven GoStations from Gogoro, an Asian-based global leader in two-wheel electric vehicle (EV) and battery-swapping technology, have arrived in the country as part of the firm’s partnership with 917Ventures and Ayala Corp.
The Globe Group and leading climate data and analytics software company Komunidad Global have teamed up to implement an early warning monitoring system in Siargao island, a famous tourist destination in the Philippines, to strengthen its climate-resiliency to typhoons and other natural emergencies.
Globe has been recognized by global industry leaders GSMA and IDATE for its relentless efforts towards climate action and integrating sustainability in its network operations.
Globe has started rolling out SIM Registration Assistance Desks in strategic locations across the country to help seniors and basic phone users register their SIMs within deadline conveniently.
Starting Feb. 9, 2023, Globe Postpaid customers may start confirming registration of their SIMs in just one easy step. To complete the SIM registration of its Postpaid customers, Globe today starts sending out an SMS asking them to confirm their details by simply texting SIMREG to 8080.
Globe, the Philippines’ leader in mobile, on Monday launched the first ever National SIM Registration Week (NSRW), rolling out assistance desks in over 500 locations across the country from February 20, 2023 onwards to make it easier for customers to register their SIM cards.
Globe customers can now register their SIMs through the GlobeOne app, another convenient and accessible option to comply with the SIM Registration Act. By making SIM registration available on the app, Globe hopes to expand reach to its subscribers and finish registration of roughly 86.7 million SIM users under the Globe network by the April 26, 2023 deadline.
Cybersecurity and Child’s Safety
As part of the company’s steadfast commitment to protecting enterprises against constantly evolving security threats, Globe Business and its managed ICT services partner, Yondu, have officially launched a dedicated state-of-the-art Security Operations Center (SOC) last February 23 at Taguig City. The advanced technology and secure operations of this local SOC provide fortified cyber intelligence, enhancing the management and maintenance of a large number of controls for clients who partner with Globe Business for their cybersecurity needs.
Globe and the Department of Education’s (DepEd) Child Protection Unit (CPU) have joined hands to address the proliferation of abuses committed against children, especially within school premises. DepEd is spearheading the creation of the DepEd Learners TeleSafe Contact Center where students can report acts of exploitation, violence, and neglect committed against them.
Globe has extended its consumer research findings on the Philippine education landscape to the Department of Education (DepEd) to contribute to the national education agenda. Initially conducted to help Globe understand its customers better, the research uncovered valuable insights into the state of education post-pandemic. It revealed its long-term impact on the workforce and the country’s overall economic outlook.
A total of 100 women from disadvantaged communities celebrated a major milestone in their journey towards financial stability and independence as they became the first batch of graduates from the livelihood program of the Globe-led Hapag Movement. The Hapag Movement is Globe’s and its partners’ unified fight against involuntary hunger, aiming to provide support for 500,000 Filipinos through tech-driven channels.
Globe signed a four-year partnership with the Rotary Club of Makati Business District (RCMBD) to raise funds for its hunger alleviation program The Hapag Movement, marking a milestone in the initiative.
Renowned Filipino chef Jessie Sincioco, one of the top chefs in the metro today, committed herself to help feed the hungry via the Hapag Movement, a Globe-led community program that aims to alleviate involuntary hunger through supplemental feeding and sustainable livelihood opportunities. Chef Jessie is able to support the Hapag Movement through the membership of her company, Manna Cuisine Corporation, with the Rotary Club of Makati Business District (RCMBD), which recently signed a four-year partnership with Globe to raise funds of up to P10 million for the Hapag Movement.
International food rescue organization Scholars of Sustenance (SOS) Philippines Food Rescue is Globe’s latest partner for The Hapag Movement, a unified hunger alleviation program.
Telemedicine service leader KonsultaMD has teamed up with some of the country’s hottest artists Kiana Valenciano, DJ Nix Damn P, and Curtismith, to raise mental health awareness through music.
The City Government of Kidapawan has tapped leading telemedicine provider KonsultaMD to make healthcare more accessible and convenient for its employees and residents. The free KonsultaMD services will be initially available to city government employees but will eventually be expanded to include the city’s 40 barangays.
Globe, through its online K-culture community, engages fandoms of popular South Korean girl groups in promoting women empowerment and girls’ rights to support World Vision’s #GirlsCan campaign. Through Globe Rewards, the fandoms have raised 51,715 for World Vision’s various initiatives that aim to support women entrepreneurs, combat the exploitation of children, and improve maternal and child health, among others.
Globe is setting a new trend with women outnumbering their male counterparts in leadership positions. This comes at a time when most Philippine boardrooms are still dominated by men. Some 52% of Globe’s executive roster are women, with 49 holding the top two ranks in the corporate hierarchy, compared to 45 men as of end 2022. This marks the first time in at least five years that there were more female executives in Globe’s core business.
Community and supply chain engagement
Globe is extending free call, text and data services to customers in Turkey after a massive 7.8-magnitude earthquake struck the southern part of the country and Northern Syria. This will allow Globe customers to use its roaming services to connect with and update their loved ones on their status in the wake of the deadly quake.
Globe welcomes the launch of the GoDigital Pilipinas (GDP) Movement under the Private Sector Advisory Council, which brings together the power of the government and the private sector to push for digital transformation in the country towards Filipino empowerment. The GDP’s goals are well-aligned with Globe’s long-standing programs under the Globe of Good, which seek to bridge the digital gap, ensure online safety and security, and foster sustainability in the digital world.
Furthermore, Globe recently partnered with givvable, an Australia-based global Artificial Intelligence-powered supplier sustainability platform, to promote the discipline and practice of sustainability throughout its supply chain.