Globe seals $155-million loan to fund capex

GLOBE Telecom, Inc. on Friday said it had signed a $155-million loan with Metropolitan Bank & Trust Co. with terms of seven and 10 years.

“The loan shall be used to finance the company’s capital expenditures for the year,” the Ayala-led telecommunications company told the stock exchange.

The company made the disclosure days after Ernest L. Cu, its president and chief executive officer, said that Globe’s budget for the year would be around $750 million and $800 million.

Earlier this year, the company said it was allocating $750 million in capex for 2017. The bulk of the funds will be invested in data-related projects, modernization of fixed line data infrastructure, and requirements for transmission facilities and for the deployment of more Long-Term Evolution (LTE) services.

Globe said as of the end of the first half of this year, it had spent around $550 million, or P27.5 billion, “primarily to support the growing demand for data across our mobile, broadband and enterprise segments.”

On Friday, the company said its capex guidance for the year stands at $750 million, although its management was looking at raising the amount by $50 million to $100 million “to continue addressing the growing demand for quality data services in the country.”

It said the progress of capital deployment in the third quarter would determine whether management would seek approval from the board for additional funds.

For the first half, Globe recorded gross service revenues of P62.9 billion, higher by 5% compared with the P59.9 billion posted a year ago.

The robust revenue, which it described as “a new record-level” for Globe, was driven by the strong contribution of data-related products and services. It said mobile data, home broadband and corporate data business segments delivered solid performances.

The company also registered “record-level” EBITDA (earnings before interest, tax, depreciation and amortization) of P27.3 billion, up 6% from the level recorded in the same period last year.

Shares in Globe were unchanged at P2,050 on Friday. – Victor V. Saulon