GLOBE Telecom Inc.’s acquisition of Bayan Telecommunications Inc. has proven to be a good buy for the company, as the then-cash-strapped telco services provider is now profitable today.
Rizza Maniego-Eala, who sits as the company CFO, reported Bayan contributed P3 billion to its parent’s top line during the first six months of the year, calling the company a “good addition” to Globe’s portfolio.
“Bayan has been a good investment for us. It is already profitable today,” she said. “It contributed P3 billion to our revenues.”
Globe acquired 98.57 percent of shareholding in the then-Lopez-owned company through a debt-to-equity transaction last year.
This allowed the former cash-strapped company to exit rehabilitation and enhance its current infrastructure and network, build more cell sites and related facilities, as well as enrich more people’s lives through the wonders of telecommunication.
Data from Globe showed Bayan made P3.02 billion in service revenues during the first half. Its net income was at P369 million.
“We removed the debt and lower the cost after we streamlined the company after the acquisition,” Eala said. “It did not destroy our profitability profile.”
Profits of Globe increased by 3 percent in the first six months of the year, thanks to its growing mobile, corporate, broadband and fixed-line businesses.
During the first semester of 2016, the company booked a net income of P9 billion, a 3-percent increase from P8.7 billion the year prior.
In the same comparative periods, Globe’s consolidated service revenues rose by 11 percent to P59.6 billion, from P53.8 billion, while operating expenses and subsidy grew by only 9 percent to P33.97 billion, from P31.12 billion.
Core net income—which does not take into account one-time gains and losses—was at P8.8 billion, a 2-percent hike versus last year.
Except for mobile, all of Globe’s businesses posted double-digit growth. Still, mobile took the lion’s share of the pie at P45.74 billion, followed by home broadband at P7.03 billion (49-percent surge), corporate data at P4.86 billion (55-percent hike) and fixed line voice at P1.9 billion (29-percent increase).