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SECURiTIES

NDEXCHANGECOMMiSSION
SEC FORM17C

CURRENTREPORTUNDERSECTlON17

C
14Februaw20151

DateofReport
3000768480000

21177

BiRTaxidentifiCatiOn Number

SECidentifiCatiOn Number
4GLOBETELECO

ExactNameofregiStrantaSSOeCIfIedinitSCharter
5PHiLiPPINES
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Formername
10SecuritieSregiSteredpursuanttoSectiOnS4and80ftheSRC

TltieofEachCiass

NumberofSharesofCommon Stock
OutstandingandAmountofDebtOutstanding
asofDecember312014

COMMONSHARES

132733090

TOTALDEBTinMonsof
indiCatetheitemnumberSrePOrted

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GL

Date4Februarv2015

2/4/2015

Globe Telecom, Inc.

Financial and Operating Results
For the Fourth Quarter and Full Year 2014
5 February 2015

2014 Financial Highlights

Service Revenues

Php 99.0B

EBITDA

Php 39.3B

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

Core Net Income

1Q15 Cash Dividend

Php 14.5B
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

Php 20.75/sh
Record date on 18 Feb,
payable on 4 Mar
Pay-out in line with policy of
distributing 75-90% of prior
years core net income

2/4/2015

Mobile: Full-year and quarterly revenues both new all-time highs, driven
by sustained growth in subscribers across postpaid and prepaid
Mobile Gross Adds

Mobile Revenues
(In Php Mn)

(in 000s)

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%

36,928
30,170

+17%
2013

38.48

2.09

2.03

38.66

36.45
4Q13

1Q14

42.72

42.85

2.08

2.16

40.64

40.69

2Q14

Postpaid

2014

Prepaid

Mobile Churn

+14%
40.75

2013

2014

Postpaid

Total Mobile Subscribers

(in Mn)

+22%

3Q14

Prepaid

44.04
2.26

7.0%

7.3%

6.7%

6.9%

Postpaid
TM
Prepaid

41.78

2.3%

4Q14

3Q14

1.8%

4Q14

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

Mobile FB Registered Users

Average Monthly Mobile

Data Revenue

+36%

+14%

(in Millions)

(in Php Mn)

11,603

14,306

+23%
Pre FB

2013
*

2014

Includes mobile browsing, VAS, GCash

and other mobile content

Post FB

Pre FB

Post FB

Return of Free Facebook Offer

In response to overwhelming demand, Globes 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

Free Facebook +

Free Viber

2/4/2015

Broadband
andtofixed
data sustains
growth
trajectory,
underpinned
Data
continues
driveline
growth
across our
business
segments
with the
by
continued
demand
for
data
connectivity
continuing shift among consumers to a digital lifestyle
Broadband Revenues

Broadband Subscribers

(in Php Mn)

(in Millions)

+37%
10,440

12,687
2.03

+22%

0.38

2.19

2.25

0.39

0.41

2.55
0.43

2.79
0.44

2.35
1.65 1.80 1.84 2.12
2013

Wired
Wireless

2014
4Q13

1Q14

2Q14

3Q14

4Q14

Fixed Line Data Revenues

(in Php Mn)

4,691

5,480

+17%

2013

2014

Globe will continue to provide best content and best experience to

enable the evolving digital lifestyle of our consumers
*Social Networking
Service Users

21Mn

As of Dec 2014

**Mobile Data Users

11.3Mn

As of Nov 2014

***Mobile Data Traffic

87K TB
FY2014

50%
30%
270%
YoY

YoY

YoY

with the best content experience in:

MUSIC

SOCIAL NETWORKING

SPORTS

*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

We launched our Generation 3 stores to revolutionize the

retail experience of our customers

New services, devices and events that deliver unique customer

experiences
iPhone6 and 6 Plus Launch

New ILD Calling Offers

New Postpaid and Prepaid Offers

New GCash Promos

New Globe Store in

Rome, Italy

2/4/2015

Financial Performance
Highlights

Consolidated Financial Highlights

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 Modn

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%)

In Php Millions

*OPEX & Subsidy includes interconnect expenses

**Core NIAT excludes forex, mark-to-market gains and losses, and non-recurring items

10

2/4/2015

EBITDA rose by 8% YoY, as robust revenue growth and lower interconnect

charges offset increases in subscriber- and network-driven costs
YoY Change in EBITDA
(in Php Millions)

853

8,531

1,193

36,514

2,123

1,110

2,193
39,269

+8%

2013

Inc. in Revenues

Dec. in
Interconnect
Charges

Inc. in Staff
Costs

Inc. in Marketing Inc. in Network

& Subsidy
Costs

Inc. in
Provisions,
Services, Others

2014

YoY Change in Core NIAT

(After-tax, in Php Millions)

6,548
5,970

11,617

5,891

287

4,043

14,488

+25%

2013

Higher Revenues

Higher OPEX &

Subsidy

Lower Depreciation

Lower Non-Op
charges

Add Back: Acc Dep

and FX/MTM
charges

2014

11

Capital expenditures at approximately Php21 Billion

FY2014 CAPEX Breakdown

CAPEX

Business
Support
Systems 15%

In Php Millions

29,000

28,999
18,007

21,235

2012

2013

2014

32%

35%

50%

35%

9%
9%

15%
15%

9%
15%

2012

2013

2014

Data
Core

2011

Core
Capex
27%

Data-driven CAPEX
49%

Guidance for 2014

20,124

Others
9%

Others
Business
Support

49%

27%

12

2/4/2015

Gross debt at Php65.3 Billion, though comfortably within covenant ratios

Gross Debt

Gross Debt/EBITDA Ratio

(in Php Millions)

61,779

48,679

2011

2012

69,301

65,276

2013

2014

1.78

1.90

2012

2013

1.39

2011

1.66

2014

Covenant = 3:1

1Q15 Dividends

Gross D/E Ratio

1.66
1.33

1.2

1.01

2011

2012

2013

Cash Dividend per

Common Share

P20.75

Record Date

18 Feb 2015

Payment Date

4 Mar 2015

2014

Covenant = 2:1

13

2015 Consolidated Outlook

Service
Revenues

Revenues up by high single digit from 2014 level

Cost
Considerations

Overall EBITDA margin of around 40% (+/- 1%), given the continuous
growth of our postpaid business, the increasing contribution of lowermargin data-related products, and focus and efforts in managing
costs
Additional interest expenses from additional debt related to 2015
capex

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

Appendix

2/4/2015

Appendix 1:
Historical Consolidated Gross / Net Service Revenues and EBITDA Margin
2013
(In Million Pesos)

1Q

2014

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

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

21,368

23,164

22,725

23,243

23,230

24,465

25,006 26,774

8,776

10,164

9,353

8,221

8,796

10,281

10,681

9,531

41%

44%

41%

35%

38%

42%

43%

36%

Fixed Line & Broadband

Total
EBITDA
EBITDA Margin

2013
(In Million Pesos)
Net Service Revenues
Interconnection Settlement
Costs

2014

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

19,172

20,683

20,425

20,939

21,173

22,293

23,044

24,086

2,196

2,481

2,300

2,304

2,057

2,172

1,962

2,238

% Change

4Q14

Appendix 2:
Net Income and Core Net Income
(in Million Pesos)
Reported Net Income After Tax
Deferred Tax on Unexercised Stock Options
Add (deduct) Forex loss (gain)
Other Adjustments (including acc. depreciation)
Core Net Income

2014

2013

3Q14

% Change

13,372

4,960

170%

2,844

3,693

(23%)

65

(92)

171%

(8)

19

(142%)
(145%)

(72)

575

(113%)

(48)

106

1,124

6,174

(82%)

123

171

(28%)

14,489

11,617

25%

2,911

3,989

(27%)