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MANILA, Philippines - Globe Telecom Inc. on Tuesday said its net income fell by a tenth in the first quarter on higher operating expenses.
The Ayala-led telco said its profit dropped by 10 percent to P2.74 billion in the January to March period from P2.96 billion in the same three-month period last year.
Consolidated service revenues increased six percent to an all-time high of P20.2 billion from last year's P19.1 billion.
Mobile revenues increased by six percent year-on-year to P16.6 billion despite intense competition and continued price pressures.
At-end March, Globe's subscriber base stood at 31 million, up 14 percent from last year.
Broadband revenues rose 13 percent year-on-year to P2 billion amid the strong take-up of Globe's services.
The company's operating expenses and subsidy rose by 16 percent to P11.6 billion, driven largely by higher subsidy and marketing expenses to acquire new and re-contract existing postpaid subscribers, support various brand-building initiatives, as well as product and service launches in the mobile business.
Network-related costs such as electricity, fuel, rent, repairs and maintenance likewise rose as a result of an expansion in Globe's 2G, 3G and broadband networks.
"We are pleased with our results this period, and the way we have built on and sustained the momentum of the last six quarters. Despite intense competition, we continue to make gains in our mobile and broadband businesses. This reinforces our commitment to our transformation agenda to better serve our customers,” Ernest L. Cu, president and chief executive of Globe said.
“The industry is entering a new phase, and we see 2012 as a year of investments in our customers, in our networks, and in our systems and processes. We expect to emerge from this investment period with significantly improved capabilities, well-positioned to grow and deliver enhanced value to all our stakeholders,” he added.
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