PLDT Inc. said Friday it is undertaking management reorganization amid a P48-billion budget overrun incurred over the past four years.
The company said the P48-billion cost overrun represented about 12.7 percent of the total capital expenditures amounting to P379 billion from 2019 to 2022.
PLDT said that based on internal investigation, it had “so far, not uncovered any fraudulent transaction, procurement anomalies or loss of assets arising from the capex spend.”
It said that because of the capex overrun, it “is undertaking a management reorganization process and has initiated improvements on its processes and systems to address weakness that allowed such budget overruns to occur.”
PLDT said the 2023 capex would continue to be elevated as overruns enter the financial stations this year and next, cushioned by significant gains on tower sales.
It said the capex levels were expected to be lower by 2024 and onwards.
“Our vendors continue to be committed to their partnership with PLDT and have expressed flexibility to work with our commercial requests involving reduction of outstanding work,” it said.
PLDT said all three major revenue streams—wireless, home and enterprise—remained healthy and robust, with home and enterprise maintaining their respective market leadership.
“These three business units are unaffected by the capex overrun,” PLDT said.
PLDT earlier posted a net profit of P27.4 billion from January to September, up 45 percent from P18.84 billion it booked in the same period last year.
Telecom core income, excluding the impact of asset sales and Voyager Innovations, went up by 10 percent to P25.4 billion in the nine-month period.
Revenues amounted to P152.93 billion in the first nine months, higher by 6 percent than P143.85 billion in the same period last year.
Meanwhile, PLDT said it signed a deal with a unit of Aboitiz Equity Ventures for the sale of 650 telecommunications towers and associated passive telecommunications infrastructure for P9.2 billion.
PLDT and subsidiaries Smart Communications Inc. and Digitel Mobile Phils. Inc. signed the sale and purchase agreement with Unity Digital Infrastructure Inc. for the 650 towers in Visayas and Mindanao.
Backed by Aboitiz InfraCapital and Partners Group, a leading global private markets investment firm, Unity is an established independent tower company in the Philippines and an existing partner of the PLDT Group.
Upon completion of the transaction, Smart will lease back the towers for a period of 10 years at competitive terms as the anchor tenant.
The sale and leaseback will be complemented by a new tower build commitment of 220 towers over the next few years enabling Smart to further expand its network and enhance customer experience.
“This transaction deepens our relationship with Unity and its shareholders, while allowing PLDT to further unlock value and providing us with additional financial and operational flexibility as we further expand across the Philippines,” PLDT chairman Manuel Pangilinan said.
