More subscribers push up Converge profits by 24%
Converge ICT Solutions Inc.’s aggressive footprint expansion into more Filipino homes propelled its first-half bottom line by 24 percent to P5.3 billion.
The fiber internet service provider on Wednesday said consolidated revenues climbed by 12.4 percent to P19.5 billion, buoyed by the residential business, which rose by more than a tenth to P16.6 billion.
Growth was likewise driven by a 19.3-percent increase in the number of subscribers, which reached 2.35 million as of end-June.
Household coverage improved to 63.72 percent from 62.3 percent last year.
“What we’re seeing is a changing of the guard in the industry and this comes as no surprise given our hard-earned investments into our fiber network,” Converge president and cofounder Grace Uy said in a statement.
Meanwhile, the enterprise segment posted a 16-percent growth in revenues to P2.9 billion, with the small and medium enterprise subsegment having the fastest growth with a 29.5-percent revenue climb.
The number of enterprise clients reached 55,906, up by 30.6 percent in the same period last year.
As a result of its strong performance in the first half, Converge upgraded its full-year topline growth guidance from 7 to 8 percent previously to 12 to 14 percent, which will be driven by both its prepaid and postpaid services.
“The Philippines is still a very under-penetrated broadband market and we do believe we have all the right products for all households in the country,” Converge chief finance officer Robert Yu told reporters during a press briefing.
Converge was earlier recognized by Ookla, a website that measures internet speed, as the fastest internet provider in the Philippines, surpassing telecommunications giants PLDT Inc. and Globe Telecom Inc.
Last month, Converge and Sky Cable Corp. inked a commercial agreement that would enable the latter to leverage Converge’s fiber network that stretches over 700,000 kilometers across the country, connecting 16 million homes.
Analysts said this would be a revenue boost for Converge, while Sky would be saved from “heavy capital expenditures” that would be needed to upgrade its own network.
Sky currently has P4.5 billion in debts, with nearly half due in one year.
Earlier this year, Sky was set to sell its broadband business and related assets to PLDT in a P6.75-billion deal, but both companies eventually decided to terminate the contract. They did not provide specific reasons.
