By DARWIN G. AMOJELAR Senior Reporter

GLOBE Telecom Inc. on Friday said its net income rose marginally in the third quarter as the cut in subscriber base weakened revenues.
Globe, which is owned by conglomerate Ayala Corp. and Singapore Telecommunications Ltd., said net income from July to September rose by 2.2 percent to P2.61 billion from last year’s P2.55 billion.
For the first nine months, net income was up by 12 percent to P9.9 billion from P8.8 billion in the same period last year.

The company’s core net income, which excludes foreign exchange, mark-to-market gains and losses and non-recurring items, was steady at P9.4 billion from January to September.

“While competition remains intense, we believe that we have the right strategies to further improve the competitive position of our mobile business,” Ernest Cu, Globe’s president and chief executive, said in a statement.

Because the company has been shedding the “marginal” or low-end subscribers, Globe’s total number of subscribers dipped to 23.1 million from 23.7 million last year.

The company said it has shifted its focus on acquiring better quality subscribers, which has translated to some early gains. During the period, mass-market brand Touch Mobile demonstrated higher revenues and average revenue per users (ARPUs) quarter-on-quarter despite a contraction in its subscribers identification module (SIM) base.

Because of this, Globe recorded a 1-percent growth in consolidated service revenues of P46.9 billion for the nine months, while third quarter revenues were down to P15.2 billion from 15.5 billion last year.

Cu, however, said that the company will strengthen its brand portfolio through innovative and affordable product offerings, resume the growth of its subscriber base through quality acquisitions, while continuing to upgrade and improve the robustness of its network.

Globe’s broadband business, on the other hand, continued to gain momentum as subscriber base grew almost three-fold to over half a million subscribers, beating full-year expectations.

The robust subscriber growth of its broadband business has translated to a revenue improvement of 69 percent to P907 million from last year, closing the period with P2.2 billion in revenues.

“We are very pleased with the significant headway we have made in the broadband space. We will accelerate our broadband capacity build to capture the growing demand for the service, and to solidify the gains we have attained so far,” Cu said.

Wireless revenues—which accounts for 89 percent of total service revenues—declined by 2 percent year-on-year, while wireline revenues grew 5 percent driven by improvements in the broadband and wireline data business.

The company’s board of directors also declared a special dividend of P50 per common share or a total of P6.6 billion in dividends to be paid out on December 15.

In addition, the board resolved to amend the company’s dividend policy by increasing the payout of regular dividends from 75 percent of net income to a range of 75 percent to 90 percent of prior year’s net income starting in 2010.