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書誌絹嵩前端器謙諜C)1 4Februaw2015 1
DateofReport
2 1177
SECidentifiCatiOn Number
4 GLOBETELECO
3 000-768-480-000
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5. PHiLiPPINES
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7 27IF,TheGlobeTower,32ndiStreetcorner7thAvenue,
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COMMONSHARES
TOTALDEBT(inM冊onsof
indiCatetheitemnumberSrePOrted
NumberofSharesofCommon Stock
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(asofDecember31,2014)
132,733,090
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Date 4Februarv2015
2/4/2015
1
Globe Telecom, Inc. Financial and Operating Results
For the Fourth Quarter and Full Year 2014
5 February 2015
2
2014 Financial Highlights
Service Revenues EBITDA
Core Net Income 1Q15 Cash Dividend
Php 99.0B Php 39.3B
Php 14.5B Php 20.75/sh
• Higher by 9% over Php90.5B in 2013
• Record December lifts 4Q14
revenues to new high of Php26.3B,
up 5% QoQ and 13% YoY
• Up 8% YoY from Php 36.5B in 2013
• 4Q14 EBITDA of Php 9.5B up 16%
YoY but down 11% QoQ on
seasonally higher opex and
subsidy
• Up 25% YoY from Php11.6B in 2013
• 4Q14 Core NIAT of Php 2.9B up
39% YoY but down 27% QoQ due
to lower 4Q14 EBITDA
• Record date on 18 Feb,
payable on 4 Mar
• Pay-out in line with policy of
distributing 75-90% of prior
year’s core net income
2/4/2015
2
36.45 38.66
40.64 40.69 41.78
38.48
40.75
42.72 42.85 44.04
4Q13 1Q14 2Q14 3Q14 4Q14Postpaid Prepaid
2.09
2.03
2.08 2.16 2.26
2013 2014
Mobile: Full-year and quarterly revenues both new all-time highs, driven
by sustained growth in subscribers across postpaid and prepaid
Total Mobile Subscribers (in Mn)
FY 2014
YoY
Change 4Q14
QoQ
Change
Postpaid 29,919 +11% 7,808 +4%
Prepaid 48,150 +5% 12,688 +4%
TOTAL 78,069 +7% 20,496 +4%
Mobile Revenues (In Php Mn)
Mobile Churn
2013 2014
Mobile Gross Adds (in ‘000s)
Prepaid Postpaid
+17%
2.3% 1.8%
7.0% 7.3%
6.7% 6.9%
3Q14 4Q14
Postpaid
TM
Prepaid
36,928
30,170
+22%
+14%
Pre FB Post FB
2013 2014
Mobile data services: Data continues to drive growth across our business
segments with the continuing shift among consumers to a digital lifestyle
Mobile Browsing and Other Data Revenues (in Php Mn)
* Includes mobile browsing, VAS, GCash and other mobile content
11,603 14,306
• In response to overwhelming demand, Globe’s Free Facebook Offer returned last October to November with the aim to seed the habit among its subscribers of mobile browsing on its expanded 3G and 4G networks
Return of Free Facebook Offer
Mobile FB Registered Users (in Millions)
Free Facebook +
Free Viber
Pre FB Post FB
Average Monthly Mobile
Data Revenue
+23%
+36% +14%
2/4/2015
3
Data continues to drive growth across our business segments with the
continuing shift among consumers to a digital lifestyle
Broadband Revenues (in Php Mn)
Fixed Line Data Revenues (in Php Mn)
Broadband Subscribers (in Millions)
1.65 1.80 1.84 2.12 2.35
0.38 0.39 0.41 0.43
0.44 2.03 2.19 2.25 2.55
2.79
4Q13 1Q14 2Q14 3Q14 4Q14
Wired
Wireless
2013 2014
10,440 12,687
+22%
Broadband and fixed line data sustains growth trajectory, underpinned
by continued demand for data connectivity
2013 2014
4,691 5,480
+17%
+37%
Globe will continue to provide best content and best experience to
enable the evolving digital lifestyle of our consumers
SPORTS MUSIC SOCIAL NETWORKING
*Social Networking
Service Users
**Mobile Data Users
***Mobile Data Traffic
50%YoY
30%YoY
270%YoY
with the best content experience in:
21Mn
11.3Mn
87K TB
As of Dec 2014
As of Nov 2014
FY2014
*number of social media accounts logged in through Globe service (mobile, nomadic, BB); **Globe subs with mobile data usage; **paid mobile data traffic
2/4/2015
4
7
We launched our Generation 3 stores to revolutionize the
retail experience of our customers
8
New services, devices and events that deliver unique customer
experiences
iPhone6 and 6 Plus Launch New Postpaid and Prepaid Offers
New GCash Promos New ILD Calling Offers
New Globe Store in Rome, Italy
2/4/2015
5
Financial Performance Highlights
*OPEX & Subsidy includes interconnect expenses **Core NIAT excludes forex, mark-to-market gains and losses, and non-recurring items
Consolidated Financial Highlights
In Php Millions 2014 2013 Y/Y
Change 4Q14 3Q14
Q/Q
Change
Service Revenues 99,025 90,500 9 % 26,324 25,006 5%
OPEX & Subsidy* (59,754) (53,986) 11% (16,811) (14,325) 17%
EBITDA 39,271 36,514 8% 9,513 10,681 (11%)
EBITDA Margin 40% 40% 36% 43%
Depreciation 18,123 27,478 (34%) 4,965 4,649 7%
Affected by Network Mod’n 1,623 9,066 (82%) 154 291 (47%)
Others 16,500 18,412 (10%) 4,810 4,358 10%
EBIT 21,148 9,036 134% 4,549 6,033 (25%)
Non-Operating Charges (1,765) (2,172) (19%) (492) (627) (22%)
NIAT 13,372 4,960 170% 2,844 3,693 (23%)
Core NIAT** 14,489 11,617 25% 2,911 3,989 (27%)
10
2/4/2015
6
14,488
5,970
6,548 287 4,043
5,891
11,617
2013 Higher Revenues Higher OPEX &Subsidy
Lower Depreciation Lower Non-Opcharges
Add Back: Acc Depand FX/MTM
charges
2014
39,269
8,531 853
1,193 2,123 1,110 2,193
36,514
2013 Inc. in Revenues Dec. in
Interconnect
Charges
Inc. in Staff
Costs
Inc. in Marketing
& Subsidy
Inc. in Network
Costs
Inc. in
Provisions,
Services, Others
2014
YoY Change in EBITDA (in Php Millions)
YoY Change in Core NIAT (After-tax, in Php Millions)
11
EBITDA rose by 8% YoY, as robust revenue growth and lower interconnect
charges offset increases in subscriber- and network-driven costs
+25%
+8%
18,007 20,124
28,999
21,235
2011 2012 2013 2014
CAPEX In Php Millions Core
Capex
27%
Data-driven CAPEX
49%
Others
9% Business
Support
Systems 15%
FY2014 CAPEX Breakdown
29,000 Guidance for 2014
12
9% 15% 15% 9%
15% 9%
50% 35% 27%
32% 35% 49%
2012 2013 2014
Data
Core
Others
BusinessSupport
Capital expenditures at approximately Php21 Billion
2/4/2015
7
Gross debt at Php65.3 Billion, though comfortably within covenant ratios
48,679 61,779
69,301 65,276
2011 2012 2013 2014
Gross Debt (in Php Millions)
1.01
1.33
1.66
1.2
2011 2012 2013 2014
Gross D/E Ratio
1.39
1.78 1.90 1.66
2011 2012 2013 2014
Gross Debt/EBITDA Ratio
Covenant = 3:1
Covenant = 2:1
13
Cash Dividend per Common Share
P20.75
Record Date 18 Feb 2015
Payment Date 4 Mar 2015
1Q15 Dividends
2015 Consolidated Outlook
Service Revenues
Cost Considerations
Capex
• Revenues up by high single digit from 2014 level
• Overall EBITDA margin of around 40% (+/- 1%), given the continuous
growth of our postpaid business, the increasing contribution of lower-
margin data-related products, and focus and efforts in managing
costs
• Additional interest expenses from additional debt related to 2015
capex
• New programmed CAPEX for 2015 to be around $650 million, of
which close to 3 /4 would be for data-related investments, such as
LTE mobile and @Home, 3G capacities and coverage deployment,
DSL augmentation and domestic and international transmission
capacities
• With $200 million of 2014 programmed CAPEX expected to slide into
the first half of 2015 (due primarily to timing issues), total 2015 CAPEX
would be around $850 million
Balance Sheet Ratios
• Gearing ratios remain comfortably within covenant levels
2/4/2015
8
Appendix
2/4/2015
9
2013 2014
(In Million Pesos) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
CONSOLIDATED SERVICE REVENUES
Mobile 17,124 18,717 18,232 18,691 18,456 19,342 19,775 20,496
Voice 7,670 8,268 8,052 8,377 8,658 8,684 8,471 8,871
SMS 6,961 7,349 7,097 7,387 7,008 7,233 7,289 7,549
Data 2,493 3,100 3,083 2,927 2,790 3,425 4,015 4,076
Fixed Line & Broadband 4,244 4,447 4,493 4,552 4,774 5,123 5,231 20,956
Broadband 2,486 2,659 2,632 2,663 2,790 3,065 3,183 2,789
Fixed Line Data 1,111 1,148 1,190 1,242 1,319 1,313 1,365 5,481
Fixed Line Voice 647 640 671 647 665 745 683 12,686
Total 21,368 23,164 22,725 23,243 23,230 24,465 25,006 26,774
EBITDA 8,776 10,164 9,353 8,221 8,796 10,281 10,681 9,531
EBITDA Margin 41% 44% 41% 35% 38% 42% 43% 36%
Appendix 1:
Historical Consolidated Gross / Net Service Revenues and EBITDA Margin
2013 2014
(In Million Pesos) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
Net Service Revenues 19,172 20,683 20,425 20,939 21,173 22,293 23,044 24,086
Interconnection Settlement Costs
2,196 2,481 2,300 2,304 2,057 2,172 1,962 2,238
Appendix 2:
Net Income and Core Net Income
(in Million Pesos) 2014 2013 % Change 4Q14 3Q14 % Change
Reported Net Income After Tax 13,372 4,960 170% 2,844 3,693 (23%)
Deferred Tax on Unexercised Stock Options 65 (92) 171% (8) 19 (142%)
Add (deduct) Forex loss (gain) (72) 575 (113%) (48) 106 (145%)
Other Adjustments – (including acc. depreciation) 1,124 6,174 (82%) 123 171 (28%)
Core Net Income 14,489 11,617 25% 2,911 3,989 (27%)