PLDT Q3 2023 Earnings Call Transcript

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Provided by Quartr
November 7, 2023

Key Takeaways

  • PLDT reported service revenues of ₱142.3 B (+1% YoY) and a record EBITDA of ₱78.4 B (+4% YoY) at a 52% margin, while cutting 9M CapEx intensity to 37% from 46%.
  • The broadband and mobile data business saw a 24% expansion in domestic fiber footprint, fiber-only revenues up 10% to ₱39.3 B, 210k fiber net adds YTD, and average mobile data usage rising 23% to 10.8 GB per subscriber.
  • Enterprise ICT revenues grew 6%, driven by managed IT and corporate data, while data center & cloud services rose 10%; the Santa Rosa hyperscale data center is on track for H1 2024 to serve rising colocation demand.
  • Maya Bank became the number one digital bank in the Philippines with nearly 3 M depositors and ₱24 B in deposits, disbursing ₱16 B in loans; its fintech arm turned EBITDA-positive in Q3 and aims for positive free cash flow by end-2024.
  • Strategic tower sales of 5,984 sites generated substantial proceeds, helping to lower net debt/EBITDA to 2.44×, and PLDT received top awards for network quality, sustainability and governance.
AI Generated. May Contain Errors.
Earnings Conference Call
PLDT Q3 2023
00:00 / 00:00

There are 9 speakers on the call.

Operator

Good afternoon, and thank you for joining us today to discuss the company's financial and operating results for the 9 months of 2023. A copy of today's presentation is posted on our website. For those who have not been able to do so, you may download the presentation from www. Through pldd.com under the Investor Relations section. I'd like to note that this briefing is being recorded.

Operator

A podcast of this event will be available on our website after the call. QR code for the presentation is on the screen and the MD and AFS and podcast will be made available after the call. For today's presentation, we have with us Mr. Alfon Lillo, President and CEO of PLDT and SMART Mr. Danny Yu, Chief Financial Officer and Chief Risk Officer through to Marylin Aquino, our Corporate Secretary and Chief Legal Counsel Mr.

Operator

Shailesh Baidwan, President of Maya Philippines and Co Founder of Maya Bank as well as other members of the PLDT management team. At this point, let me turn the floor over to Mr. Bandilio to begin the presentation.

Speaker 1

Thank you, Melissa. Good afternoon to all and thank you for joining us this afternoon. I'd like to start off the presentation The few highlights of the business and then I'll pass it on to Danny for a more detailed financial highlights report and then to SP for 3. Yes, please. Happy to report our 1st 9 months performance for Purity Smart.

Speaker 1

Growth was made possible in 9 months 2020 performance. To start with, we have BRL142.3 billion For 1% growth in revenues, we've seen a 9 month high revenues for TWT. We also had all time 9 month high for our EBITDA of BRL17.4 billion, plus 4, percent period of last year, Able to maintain margin at 52% EBITDA margin. TelcoCore I've shown growth also, plus 2,000,000,000,000,000 for the period. And also want to share the CapEx we managed down BRL 55.3 billion versus BRL67.3 billion of same period last year.

Speaker 1

So because of that, the impact intensity has gone down to 37% from a high of 46%. That's clear. Next page. So we continue to expand our network, exactly why. We improved we increased our Fiber footprint, domestic fiber footprint by 24%.

Speaker 1

That's now up to almost 894 1,000 parameters and if you add the fiber optic backbone of in terms of Fr Subsea, It's about BRL1.1 billion in the aggregate of fiber. Postpaid is BRL17.31 billion, up from 16.78 percent last year. I'm also happy to report that there are now more devices latched on to our network, positive 34% growth. Now we have 3,64,000,000 who are launched on 5 gs devices in our network. Jupyter Cablesystem, which we launched Last year was also we obtained certification for ISO 22,301 BCMS.

Speaker 1

And just an update on the tower sales that we started about 1.5 years ago, 2 years ago, We've closed 13.19 closed cell towers as of November 3, generating proceeds of about BRL 7.4 billion. And in total, from the first sale that we have, we've already completed total over of 5,984 towers equivalent to ARS470 1,000,000,000. Yes, sir. Next page please. Happy to report also.

Speaker 1

Next page. The recognition that we've gotten as a group, both locally and globally, Poomla has rated smart as the best in test, both upload speeds, download speeds and the experience And has been a consistent winner since 2019. Time Magazine actually also put PBT as the only Philippine telco Main and it's ranked highest in its sustainability among 6 active Philippine companies recently and we continue to also get awards in terms of the governance initiatives, scorecard and recognition, Which, recognize PLDP upholding high standards of corporate governance. Next page. Our 3 business units continue to push for growth through innovation.

Speaker 1

Smart, We continue to empower digital lifestyles through exciting personalized offers. And we have Alex Cai here today who can Answer your questions on what's in store for our wireless customers. And by the way, we have now the highest in terms of Piyat Piyang, Jeremiah Dedakos is here. He can also share with you some of the plans in keeping families safe, connected, productive and in need, Both offers on fiber and fixed wireless products And we have the enterprise both Mitch, Roxanne and Vivo and Vino are here Make sure that we're able to provide innovative solutions for the nature of transformation of the industries that we cover, both 20. Next page please.

Speaker 1

Next page. So staying true to our company's core and I guess sustainability, we did put We had a digital convention held last October, Cognition, in particular Yes. Our discussions in the digital hub was about sustainability in-depth, our discussions on sustainability and the program that we have embarked as PLDT. That we had a swing to telephone over with Jesup Connor, the ICB set Ivan during the time. And we also implemented e waste collection stations for Delekis, same with the set of pillar here where we put it in our businesses where we're collecting Old phones, chargers, devices, modem to properly dispose this.

Speaker 1

And in Fozantilab, we did have a strategic initiatives that we have for our sustainability where we can send death bottles, Classic bottles that we want to also expose sustainability.

Speaker 2

Next page.

Speaker 1

Our push for vision building Through public and private collaboration, remains to be strong. PLC Group joined the call for the creation of a connectivity index creating through PSAC To elevate the Internet quality in the country, it is to bring buildings for customers and for people to be able to raise building its We also partnered with Maya, back with the GDP and DTI taxes expo 2023, which is happening this month. And during also the Digicon, we launched the first ever Versalarm Cloud with the SMB, the fast track digit transformation of the country's public sector. But this should also be used obviously by private sector as soon as the IRR or the guidelines have been put Our smart PLD Smart Foundation remains to be very busy in serving our communities. Just to highlight, allowed for all the CapExAT initiative by the First Lady is supported not only by PLDT, but also the MP Group of Companies, Others that we continue to push.

Speaker 1

Next page. So at this point, we will continue to innovate For tomorrow and but we'll be excited to be here today and we will continue to push this last quarter to make sure that we're able to and the year attained. So at this point, I'd like to move the presentation to Danny for a more detailed presentation.

Speaker 3

Thank you. Good afternoon, everyone. I'll be presenting the financial and operating highlights for the 1st 9 months of 2023. Service revenues of RMB142.3 billion for the 1st 9 months of 2023 were higher by 1% compared to the same period last this year. On gross basis, service revenues of RMB149.8 billion were up 3% from 3,000,000,000 in 2022.

Speaker 3

Operating expenses decreased by 3% 3. RMB41.7 billion to RMB63.9 billion. Consolidated EBITDA rose by 4% to RMB78.4 billion, an all time 9 month high with EBITDA margin at 52%. Telco core income, Excluding the impact of asset sales in Maya grew to RMB26.1 billion, up 2% year on year. Next, please.

Speaker 3

On segment basis, revenue growth was broad based. Individual revenues representing about 43% of Consolidated revenues rose 1% to RMB60.6 billion. Record highs were registered in the home and enterprise segments. Home revenues rose 2% to RMB45.3 billion, with fiber only revenues having risen 10% to RMB39.3 billion. Home revenues, Our enterprise business grew by 1% to RMB34.8 billion.

Speaker 3

Let me now go through the segments in greater detail. Next please. Home broadband revenues grew by 2% fiber Which now account for A7 total home revenues were higher by 10% or R3.6 billion dollars compared to the same period last year. As a result of the close app installation plus migration and loading, fiber net adds reapplied in the 3rd quarter with 48,000 compared to 42 1,000 in the Q2, bringing the total net adds for the year to 210,000. The growth of our fiber only revenues and the sequential albeit modest improvement of revenues from our fixed wireless broadband business Underscore our view that the home broadband market remains underpenetrated with conserve demand more at the lower market segments, thus more sensitive to price.

Speaker 3

Unique to PLDT is the ability to complement our fiber offer with others at different price points using varied fixed and wireless technologies to address market affordability. PLDT continues to enjoy strong brand equity and superior network quality, making it a formidable competitor in the market. Next please. Data and ICT remain the key drivers of our enterprise business, which registered a revenue increase of 1% to BRL34.8 billion from the same period last year with 3rd quarter revenues up by 2%. Corporate data grew by 6% due to higher fiber, managed IT and iGate revenues.

Speaker 3

EP LED recorded a 10% increase in revenues mainly from data center and cloud services. With the Santa Rosa data center capacity expected to come on stream Ahead of competition in the first half twenty twenty four, EPLET is well positioned to capture the robust demand from hyperscalers. In addition, our growth pipeline is fueled by our enterprise teams focused on enabling digital transformation in the space of corporate, SMEs and government during the creation of smart cities in the first ever launch. Next, please. Positive trends are also manifesting in the individual segment, which has faced various challenges over the years.

Speaker 3

Revenue for our individual business rose by 1% in the 1st 9 months of the year. In the 3rd quarter, which is historically low, Revenues were higher by RMB100 1,000,000 versus the same quarter and RMB400 1,000,000 higher than the same quarter in 2022, A 2% 6% growth in prepaid and postpaid revenues in the 3rd quarter supported year to date revenue improvements compared to last year. Mobile data revenues dropped to RMB52.4 billion with active data users of almost 38,000,000 and following a 15% rise in data traffic. Average monthly data usage per customer escalated to 10.8 Gigabytes, up by 23% from last year and 17% from full year 2022. While the industry availments of number of portability remains small since the implementation of M and P in 2020, The majority of customers that ported their numbers moved to smart, reflecting recognitions of PLDT's network advantage.

Speaker 3

Next, please. In the 1st 9 months of 2023, 82% of our consolidated service revenues were from data and broadband. By service type, Mobile data rose by 3% year on year, while broadband and corporate data grew by 4% and 6%, respectively. ICT revenues were up 10%, including an 8% rise in data center revenues, Our broad based cost management effort, next please, was undertaken resulting in a 3% or RMB1.7 billion drop In total expenses, including provisions and subsidies, the combined impact of increase in revenues And decline in costs is a 4% rise in consolidated EBITDA to RMB78.4 billion, A 9 month record high with margin at 52%. Telco core income for the period grew by 2% to RMB26.1 billion year on year, reflecting the impact of higher EBITDA, partly offset by higher depreciation, higher financing costs and higher tax provision.

Speaker 3

Telco core for the 3rd quarter is stable compared to the same quarter last year. Next please. On reported basis, PLDT income grew by 1% to RMB27,900,000,000, mainly from the gain from the tower sale and leaseback transactions, OREX and derivative gains, partly offset by MRP costs. Note that our share in losses from Maya stood at RMB1.7 billion, lower than the RMB2.4 billion reported last year. This moderation in losses is in line with the expectation of breakeven and profitability towards the end of 2024.

Speaker 3

Next please. PLDT's balance sheet remains healthy with net debt to EBITDA at the end of September at 2.44 times, lower than the 2.48 times at the end of June. We expect this to further improve with the receipt of the remaining tower sales proceeds. Gross debt amounted to DKK 274,500,000,000 of which 15% are dollar denominated and 5% unhedged. Interest cost for the period stood at 4.49 pretax while the average life of debt is 6.7 years.

Speaker 3

Next, please. Total CapEx For 9 months amounted to RMB55.3 billion, consisting of network and IT CapEx of RMB49.4 billion and business CapEx of CNY6 1,000,000,000. In line with our objective of bringing down CapEx and aiming for positive free cash flow, CapEx intensity for the period has fallen below the 40% mark to 37% and is lower than the 46% recorded last year. In addition, the CapEx of RMB55.3 billion is RMB23.1 billion lower than EBITDA for the period of RMB78.4 billion. We maintain our CapEx guidance for the year of Between RMB80 1,000,000,000 and RMB85 1,000,000,000.

Speaker 3

This includes approximately about RMB11 1,000,000,000 out of the RMB33 1,000,000,000 prior year's commitment. We continue to tightly stream and closely monitor our CapEx, especially multiyear projects, as well as introduce end to end process improvements in the value chain covering plan to budget approval, procure to pay, This page shows the usual network highlights. On the fixed network, we passed 17,300,000 homes and cover about 18,100 barangays, representing 43% of the total barangays in the Philippines. Total fiber ports grew to 1,000,000 to 6,200,000 as we have accelerated port rollout. We continue to carefully rationalize the rollout of reports to ensure optimal utilization.

Speaker 3

SPEOLIT Total fiber footprint remains unparalleled with a total of over 1,100,000 kilometers. Population coverage of our wireless network stands at 97%, About 82% of the total handsets on the network are LTE or 4 gs. Next page, please. The number of unique 5 gs devices

Speaker 1

20.

Speaker 3

And spectrum efficiencies, we reduced the number of our 5 gs base stations. Nevertheless, our 5 gs speed Remain faster than that of competition based on top class peak test. Let me

Speaker 4

Thank you, Danny. So in 2023, we continue to push the boundaries of our FinTech ecosystem 3. With the Bayer Digital Bank at the heart of it and continue to launch new products and growing all our businesses. So in the Philippines, we are the number one digital bank in terms of number of depositors and the deposit balance and we continue to see Very good growth across our loans portfolio and I'll touch upon that. On the merchant acquiring business, which is where we process Visa and Mastercard through our BH, Domestic debit, again, we are the leaders in number of transactions processed in the Philippines across all these various fund sources And continue to see that market share expand.

Speaker 4

And we are the number one finance app in the Philippines, which is our Maya Consumer app. Let me give a little more color across each of these. So, if you look at on the Myer consumer app, which was largely a payment centric app and now has gone on and evolved into an all in one full financial service app for consumers. We introduced our high engagement saving product last year. Our customers look forward at the start of the month to pay their electricity bill, their various utility bills, to do their various purchases, which then helps them to earn higher interest rate.

Speaker 4

And on the back of that information that we are able to collect on customers, we are able to create better profiles and deeper standing of the behavior, which then goes into our credit scoring models and allows us to provide them with our credit products product via personal loans and we have seen extremely positive take up of that in the early stages of this launch. We continue to expand our services by adding on investments. So now customers are able to purchase and invest in a number of funds And we will add the ability to purchase individual stocks on the Philippines Stock Exchange over the coming weeks. So what this has enabled is really helped The Maya consumer app to become the all in one primary financial services app for the customers and we are seeing them generating 2 to 4 times more ARPU and profit per user versus a payments only. We see the same story when we look at on an enterprise side of the business.

Speaker 4

This is a business where we provide whether you're a large online player, A multi and omni channel there providing you with a full suite of payment solutions, including whether it's just for QR or whether it's Visa, Mastercard or any other fund source including domestic debit. As I mentioned, our share in number of transactions today in this business is over 50% across Visa, Mastercard, QRPH, that's a market. And with the addition of Maya Bank, we've now been able to integrate the ability For merchants, especially the SMEs to be able to use Maya Bank deposit to put their settlement account And we have now started testing and piloting on credit products to both micro and to small SMEs. So in the same portal where they do all their transactions for payments, they are now able to draw down on credit, on working capital products, If you are able to provide on the back of seeing their payment transactions and business flows. So this is another area where we have piloted a number of products And are now scaling those and rolling those out through the course of the rest of 2023.

Speaker 4

And if you go to the next slide, to give you some color around the numbers, The number of depositors that we have in Maya Bank grew to 2,600,000. In fact, as of now the number is very much close to 3,000,000 depositors And that's resulted in us having a deposit balance of nearly Ps. 24,000,000,000. We have been, as I mentioned, we started Disposing consumer loans, adding on newer product consumers and adding on the micro and SME products. We have disclosed over MXN16 1,000,000,000 Off loans in the last months.

Speaker 4

And as a result of this expansion and the Maya, both the On the enterprise side and on the consumer side becoming key drivers, we've seen EBITDA across the business have become profitable In the Q3 of 2023. And as Danny mentioned, thanks to that, not only have we been able to grow more than double our net income year on year, We've been able to bring down our cash burn by nearly 40% versus last year and with the expansion that we are seeing in the business with the continued growth In the net income, as we launch new product and scale new products, we are looking at making the business cash flow positive towards the end of 2024. With that, I'm going to hand this back to Al.

Speaker 1

Thank you. Thank you, Espy. I don't think I mute this online. I just wanted to give The outlook guidance for 2023, service revenue growth, low single digit growth for the group. EBITDA will also be low single digit growth.

Speaker 1

The core income will be at least BRL24 1,000,000,000. CapEx, We're looking at between the 2017 and 39 months of 2019 this year and we will try to we will continue obviously on dividends sorry, MBP is here. And then for dividends, we will obviously try

Operator

At this point, we're now ready to take your questions. You may type your questions in the Q and A box in the upper right side of the screen. 2. You may also send your questions via e mail to for ircenter@pond. Ph.

Operator

Please indicate your name and company name so we can get back to you for any additional The first set of questions comes from Stephen Oliveros of China Bank Securities. The first one, how does CEL plan to sustain its top line momentum in 2024 given protracted periods of elevated interest rates and inflation?

Speaker 1

I guess to start, but I think we haven't finalized our budget for next year, but obviously we're going to target Growth for revenue line. Some of the initiatives that will be On stream next year will be our 11th data center, which will be on stream by June of next year. So we will have the 6 month benefit Of that and hopefully full year and the following year. I think we're showing positive momentum on mobile and we'll continue To grow that, there's still some growth areas still in off that we are also pursuing. Although Danny did say that It's starting to get to the financially challenged market, a segment of the market.

Speaker 1

That's why I think the ability of Home To offer both fiber and fixed wireless solutions would be helpful that push. And I know that enterprise continues to push digital transformation across the enterprise space of customers. Renuwa, do you want to add a few things?

Operator

Okay. The next question, how does Maia Bank plan to strike a balance between funding costs and interest income given the attractive deposit rates your currency offering?

Speaker 4

Yes, we absolutely are trying to strip off as in fact what we have Understood and seen as a deliberate effort on our part is to ensure that the customers where it's high engagement banking see a growth in both the customers and deposit balances over there, Which is where we get a lot of rich information on the customers and these are customers who for certain periods of time have positive balances but also Over a period of time, we need access to credit. And by virtue of seeing the transaction behavior, we are able to score them and provide them with my credit. And that piece has worked really well. What we did see was that we had balances in our personal goals product, which was a time deposit equivalent product. And in that, we had some customers with high balances because of the Interest rate, what we have done is we are reworking that product and as a result of that we have seen some reduction in the balances on that product.

Speaker 4

So, if you look at Our performance quarter on quarter, the number of customers that we have in Maya Bank has actually gone up, but the number of the amount of deposit balance has actually stayed pretty much flat. That's helped us. And the second is, of course, growing the loan book. At this stage, as I mentioned, we have dispersed over Ps. 16,000,000,000 of loan.

Speaker 4

These are largely short tenure loans. So as a result, of course, our outstanding loan book is modest. But as we expand into longer tenure roles, As I mentioned, personal loans, SME loans, we will also start seeing our loan to deposit ratio go up. So we'll add a deliberate strategy of making sure that we're growing the number of Customers that we have, we are getting the transaction behavior and payment behaviors, which is helping us and that helps us with high engagement banking. But we're very conscious of making sure that we're not This take and encumbered with high balance deposits at high interest rates and that's what we have pretty much worked on over the course of the last couple of quarters And continue to refine that.

Operator

There is a raised hand, Arthur.

Speaker 5

Hi, can you hear me?

Operator

Yes, we can.

Speaker 5

Yes, thanks for the opportunity. Several questions, please. Firstly, on mobile, I'm just wondering what can be done to address the revenue growth caps versus your competitor? Now it's PLDT has had the benefit of network upgrades for quite a while now With the network advantages being claimed, what are the challenges in taking the premium users away from your competitor? Second question I had is with regard to the data center.

Speaker 5

Can we get some idea on the expected contributions from this? You've mentioned Contributions or commercialization by early 2024, how much can this generate into the year? And is this immediately profitable? Or is there a ramp up phase needed With utilization. And final question comes back to mobile.

Speaker 5

I'm just wondering, what does it take To get industry revenue growth tracking alongside broader GDP growth, when you look at other markets in Asia, it seems to be tracking well. Philippines seems to be an outlier. Basically, I'm just wondering what can be done so that you're back to mid single digits?

Speaker 1

I'll have Alex answer the mobile question now. So thank you very much, Jose.

Speaker 6

Yes. We're looking at growth for 2024, Riding on the restart of our network expansion as well as the delivery of platform capabilities That will allow us to deploy targeted, customized and very timely offers that are indeed relevant and value packed. Obviously, there's a skew towards our customers on postpaid business. We realize that we have work to do there in order Of course, we will have to bank on the strength of the network. We have been looking at improvements in terms of speed As well as quality and we also continue to work on our indoor publish where most of the mobile consumption has shifted Even as increased mobility has already been seen for the 1st few quarters of this year.

Speaker 1

Yes, Salvator, I think we if you look at the sub numbers we're ahead based on this third quarter reporting, we're at 55.2 Globa said yesterday that we have 50% and so our task is how do we basically tap on revenues is something that we have to work on Moving forward, you want to answer this, The third one for my Vol was

Speaker 7

in my Vol. How do you get the instant revenue growth?

Speaker 6

Well, the programs that we have lined up are geared towards accelerating mobile data burn. A number of our customers have continued to enjoy the better offers, but I think we have to see the velocity. That's why the emphasis on faster burn as well as understanding the segments which require A higher bandwidth allocations and at the same time, the related offers that might be interesting for this target market, Whether it involves fintech solutions or entertainment and the like.

Speaker 1

Thank you, Alex. I'll ask Viboy to answer the data center. Yes, Javi.

Speaker 2

Thank you for the question on data centers. I think the advantage of the PODD platform is we have available capacity. And secondly, we will be the 1st to market to actually have a hyperscale data center in the country. This is very advantageous For us, because as companies in the public sector transform digitally, they're looking for colocation services to meet 3. The digital infrastructure requirements and we will be in the best position to capture most of this given those two factors of available capacity and the first to market With a hyperscaler data center by the middle of next year.

Speaker 1

How soon can you monetize and profit?

Speaker 2

Yes. So if you look at

Speaker 1

the data center, obviously, it

Speaker 2

is like building a house that you need tenants. So we would need to find the tenants to fill it up. There will be a ramp up phase. We are looking for an anchor tenant to fill up that space that we have. And the anchor tenants will come in the form of hyperscalers, Eastern or Western hyperscalers.

Speaker 2

And as soon as they ramp up, then it will be easier for us to monetize The colocation space that they've taken in our data center. We did

Speaker 1

we have started setting the space and we think we Very warm on a few big engagements with hyperscalers, 1 from the west, half of the east, so maybe 2 from the west. And that's something that we're really working hard on. So we want to make sure that we can fill it as soon as possible. In fact, we're looking What's available by June next year is 10 megawatts, but we're pushing for not 10 megawatts by November. Then period part of 2024 would be the balance 16 megawatts.

Speaker 1

So the teams are pushing very hard to get contracted Even prior to the completion of the biggest center in Central Bank. Hello, Pardo. We've answered your questions.

Speaker 5

Thanks, Al. Just maybe to clarify, are there any plans to find any strategic partner which

Speaker 1

We're undergoing a process now. In fact, we'll share it with the Board. And We actually have a very short list and we're expecting some Finding offers hopefully by the latter part in November. Just precisely exactly what you said, looking for strategic partner But we'll grow the business and operate it more efficiently because of the experience of the partner that we want to bring in.

Speaker 5

Understood. Thank you very much.

Speaker 1

Thank you.

Operator

The next question is on mobile. Have you seen any impact from Vito after it received fresh funding?

Speaker 1

Alex?

Speaker 6

Well, there's been On ground as well as online action from the challenger, obviously, they will have to ride on marketing offers That will go with the expansion of the network. We understand that a number of customers either from our side or from The other competitor might

Speaker 1

be, if

Speaker 6

I may say, trying to experiment and understand, do they, in fact, Merit being second seen inside our devices. But we have seen from the marketplace that Anomalibi customers have actually gone back to their primary service providers after understanding that the service is more reliable, more consistent and more predictable.

Operator

Thanks, Alex. Next, there's a question. What are your views on prepaid home

Speaker 7

Yes. Thanks, Sal. So first, before I answer the question on prepaid Overall bandwidth, particularly prepaid fiber, I just want to remind everybody that PLDT is in a great position to be able to leverage 2 very, very Strong networks. Our mobile network actually rated extremely high with high performing both 5 gs as well as 4 gs, which enables us to be able to sell fixed wireless as an offering to customers to be able to service not only areas that we don't have fiber, But to also service a different demographic of customer that may be looking for more of a sachet based sort of infrequent usage for various reasons. The second one is as our fiber network, which we have actually had quite an extensive rollout And we currently do enjoy about 60% utilization, right?

Speaker 7

So we actually have about 60% of all of our ports with tolling customers. So we have 2 weapons that we're able to leverage. Because of the situation that we're in, I guess we're approaching the market A little bit differently from competition. We've led our push into the prepaid space with fixed wireless. So we've actually seen fixed wireless as a category has been challenged in the market for the last 9 months.

Speaker 7

What we are very pleased to be able to report back is we've seen 2 consecutive quarters of growth in our fixed wireless space. So we've actually seen 5% quarter on quarter growth in terms of fixed wireless revenues. Now whilst that may still be somewhat Small compared to the, say, for example, fiber revenues. It does show that there is a role for fixed wireless play in being able to service the different customer needs for the different segments. From a fiber perspective, we have actually as we mentioned in the half year results, we do have plans to go into the prepaid In fact, we are currently trialing with some of our existing customers now, our prepaid offering.

Speaker 7

The approach we are taking is much more measured approach though. We want to be very, very targeted with the areas that we make our prepaid fiber available Because we do currently enjoy the largest fiber base with a very, very high utilization rate, we want to make sure that prepaid fiber is something that's revenue accretive as opposed to revenue dilutive. We've seen through some of the other information released by the competition that the prepaid fiber ARPUs are significantly lower Then postpaid ARPUs. So we want to make sure that we do prioritize where it is possible for our ports to be sold to postpaid customers where we get a higher yield. And where we do have an abundance of prepaid, that's where we'll be using, prepaid fiber.

Speaker 7

So to answer your question maybe in a shorter way, We do think there is a role for prepaid fiber to actually play in the market, but we're not only dependent on prepaid fiber to be able to service that segment, We also have the benefit of also using fixed wireless to be able to attack that segment of the market.

Operator

You mentioned about the launch of a sovereign cloud. What are the potentials of this business? And what is the traction so far?

Speaker 7

Thank you for that question.

Speaker 2

When we built the Sovereign Cloud, we really had Target markets in mind. One was really government services and the other one is the private sector. We felt that as part of our role to help Digitalize the economy and help the administration also digitalize most of its public services. Building a sovereign cloud in the Philippines was a first step for us in being able to offer that solution. This is a service that is similarly implemented or rolled out in other markets.

Speaker 2

We are actually the 6th or the 7th market in Asia To be able to roll out a sovereign cloud. So we feel that there's going to be usage and traction for this. We cannot obviously say who the government agencies are given the sensitivity of data that we will be hosting. But Yes. It has been a welcome solution for a need that government agencies have been looking for quite some time.

Operator

There is a question on Maya. Are there any plans for fundraising?

Speaker 4

Yes, we are very much, as I mentioned, a couple of quick pointers to that. The business actually also business became segment EBITDA positive in the Q3 of this year and we continue to push towards The overall company becoming cash positive towards the end of 2024. In the interim, while we are funded on a lot of the operating side, As we expand our loan book, we do need access to capital for some of the regulatory capital and to grow the loans book. So we are concluding So no funding down with existing shareholders to fund for the requirements that we have till 2024. We should be able to conclude that over the coming days and should be able to share details.

Speaker 1

I just wanted to add to that, that PLDT will actually participate in that round and in fact would increase its equity in Turkey and for specific increase its equity in

Operator

First question on CapEx intensity. You've reduced your CapEx intensity significantly. How much lower can that go? And when do you expect it to get to the 25% level similar to other telcos in the region?

Speaker 1

Sidan? I'm not sure whether 25% is possible for us in the Philippines, but I think what Initially, we'd like to bring it down to Mr. Sousan. Thank you, Kapik. That's a target maybe for Next year, you're

Operator

sold. There's a question on whether we're planning to do any more tower sales.

Speaker 1

Right now, we want to just complete first what we have sold. There's still quite a bit of we've done a lot. In my summary, I said that we had 5,900 and I saw towers. I think that we've already 5,984 that we already closed, so it's only 79%, 80%. So there's a bit there's still 20% that we need to close.

Speaker 1

We're hoping that we can

Operator

Are there any other questions? There's nothing in the queue. Please feel free to raise your hand or type your question in the chat box. We see a hand raised.

Speaker 7

It works.

Speaker 1

It works. Maybe MBP can.

Operator

MBP, would you like to share some comments? There are no other questions in the queue.

Speaker 8

Guzman, nothing significant. So better say quiet like which I didn't in the media, right?

Speaker 1

We will not call you. Don't worry. Maybe there's a question from Hermann

Operator

Villacast. Herman, please unmute your mic.

Speaker 8

Yes, I'm okay. Yes, I've unmuted. Can you hear me?

Speaker 1

Yes, sir.

Operator

Yes, we can. Okay. There's a question from Herman De La Paz. Herman? Halloween special.

Operator

There are no further questions. I'll turn the floor over to our Chairman, Mr. Pangilinan, for any final

Speaker 3

Nothing

Speaker 8

really special by way of closing except to thank you for joining us this afternoon For the Q3 briefing, and we look forward to seeing you again perhaps sometime in February or March next year. So in the meantime, on behalf of all of us, we wish to all of you a very Merry Christmas.

Speaker 1

Thank you.

Operator

And that concludes today's briefing. As always, should you have any further questions or clarifications, please reach out to PLDT Investor Relations. Thank you for your participation. Good afternoon.

Speaker 1

Thank you. Thank you.

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