PLDT Inc.

For today's presentation, we have with us our Chairman Manny Pangilinan, Mr. Al Panlilio, our President and CEO, Ms. Annabel M. Chua, Chief Finance Officer and Chief Risk Officer, Mr. Shinesh Bhatwan, President of Voyager Innovations and Paymaya Philippines, as well as other members of the PLTD Management Team. At this point, let me turn the floor over to Mr. Panlilio to begin the presentation.

Hi, Melissa. Thank you very much. Good afternoon to all and thank you for joining us in this call. You know, I'll be reporting some highlights of our Q3 and nine-month performance. Then I will pass it on to Annabel for a more detailed discussion on the financials. Then we go to SB for Paymaya and Mayapak. So happy to report for Q3 2021 performance for QuilitySmart. We end the quarter at 7.9 billion. This is the highest quarter this year. And after 7.5 in first quarter, 7.7 in the second and third quarter, 7.9. That's a 786 billion income growth in federal terms for 11%. Also happy to report that our net service revenue for the third quarter is also an all-time high of 46 billion. This is 2.8 billion higher than the same period last year, 5%. Expenses at 21.5%. For the month end of September, September YTD, we're ending the first nine months at 23.1 billion in telco core income, which is a 2.1 billion income growth compared to previous year, or at 10%. Service revenues after nine months is 135.9 billion, also an all-time high on that service revenue. Expenses of 64.8 billion and adjusted bid of 71.5 billion, 8%. Thank you very much. Thank you very much. We've also exceeded this number. We hit a little over 120,000 for October. So we continue to drive and serve the underserved market. By the end of September, we have about 800,000 new fiber customers. So we are on track of at least 1 million by the end of the year, new fiber subscribers by the end of the year. For wireless, A lot of headwinds in wireless this year, especially with all the lockdown, people losing their jobs, and really no mobility for our customers, and really customers sharing the fixed line connectivity at home. Having said that, we will see modest growth for wireless this year. Thank you very much. Starting in the third quarter of this year, 10.7 billion being the highest ever quarter for enterprise, driven by ICT business, obviously cloud, and co-location revenues from data centers at an all-time high also, increasing by 26%. Next page. So that is your integrated telco business. We continue to drive CX by improving our network. So we have the Philippines fastest and most extensive network. We are now at 615,000 kilometers of fiber, 17% increase from June. So we have the most extensive for sure in the country. HomesPass now is at 12.7 million year-to-date, which is an increase of 41% versus last year. 12.7 represents about 50% of total households in the Philippines, and so there's a lot of opportunity of growth still in the home business. FiberPorts, out of the 12.7, we have 5.29 FiberPorts that is available for our customers, which is 30% increase. And for mobile, we also continue to strengthen the mobile business. We are now at 6,400 in terms of live 5G pay stations, 96% in LTE network coverage, 72,000 total pay stations. And we continue to progress our roaming arrangements, hoping that travel will happen soon. So again, in both areas, fastest fixed network, as reported by UPLA, and also the most reliable 5G network as far as UCLAOS is concerned, and the only Filipino telco in globally with 5G experience as far as what we're seeing. So that's the Integrated Telco initiative that we have. Next page, please. And again, together with Integrated Telco, we continue to expand the PLDT ecosystem, making sure that we're able to build a digital ecosystem to secure our future growth. On the left side is Gigalife, which is an online digital platform for our wireless customers. Eventually, this will be a platform also for home. Today, we have 10 million registered users for Gigalife and an active base of 6.25 million multi-active users. I think SB will obviously talk about this more, but really driving broader financial inclusion, which we can really seamlessly integrate the PLTD smart business with Playmaya and InfoEdger. Having gotten the digital bank license is a very critical part of that journey towards financial inclusion. From a people and culture point of view, our most valued assets, of course, are people. I just wanted to report that 95% of our people in smart workforce nationwide are fully vaccinated. And we've started vaccination also for dependents and household members as we speak. So I think I move on now to, I will move the mic to the screen to Annabel.

Thank you. Thank you. Good afternoon, everyone. And welcome to our nine-month results presentation. As Sal has indicated, total service revenues for the nine-month period came in at 135.9 billion, which is 7% up year-on-year. How it breaks down? About 65 billion from individual, 35 billion from home, and another 35 billion from the enterprise and international combined. In terms of the growth versus last year, that's a 9 billion increase led by home, which accounted for 7 billion out of the 9 billion uplift that we saw in the first nine months. And as Alice mentioned, if we zero in on the fiber-only subcomponent of the home business, that's actually growing at a much higher clip, at 78% year-on-year, registering a 10 billion increase for the period. Together with the 7 billion increase from home, we saw another 2 billion increase from our individual business, which is up 3% year-on-year, and then 600 million from our enterprise business, which is a 2% year-on-year growth. Next chart, please. Over the three quarters of 2021, the increase in the third quarter revenues to $46 billion from $45 billion in the second quarter and $44.8 billion in the first quarter. Compared to the same period last year, it's a 5% growth equivalent to $2.8 billion. Again, the charge is small, which is showing a very impressive 29% increase in the third quarter compared to, say, last year. Enterprise is also showing 2% growth now and hitting a record high of 10.7 billion during the quarter. There's more pressure in our individual business given the lack of mobility during the pandemic period and the knockout effect it has had on people's consumer wallets as well as the increased competition that we're starting to see in the market. But although the group was able to hit an all-time high of 46 billion for the Thank you very much. When you break it down between data and non-data revenues, our data revenues are growing at 14% year-on-year and account for 76% of the nine-month service revenues. For the quarter, it's already 77% of total revenues. Next chart. Making up our 104 billion of data revenues, on the right-hand side of this chart, you see that mobile data is about half of that number growing at... Thank you very much. That's 8% increase equivalent to 5 billion pesos compared to the same period last year. Depreciation and amortization as well as financing costs have also been a bit higher compared to prior periods given our investments in our CapEx for the net worth and other items. So DelcoCorp income at 23.1 billion is a 10% or 2.1 billion rise over the 21 billion that we reported for last year. There is also the benefit of the lower income tax rates as a result of the create tax loan to SPACs. Moving on. Again, showing it over the three quarters of the year. Just to take note that we've been able to manage our cash OPEX to a relatively flat number over the three quarters of this period, such that even during the third quarter benefited from the higher income numbers. So we have 24.5 billion to be the outcome for the third quarter, which again represents also an all-time high for us. On a telco core income, as noted, we've been able to see improvements over the quarters from 7.5 to 7.7 and 7.5 billion in the third quarter. Looking at our total subscriber customer base for the group, We have a total customer count of 77.8 million across our mobile, broadband, and fixed-line voice businesses. Just to highlight, for our broadband customers, there are almost 3.8 million broadband customers, fixed wireless of about a million, and 2.8 million at the fixed side. Fiber, as you can see here, increased 800,000 for the nine-month period since the start of the year. I'll show the details for that data. Thank you very much. Thank you very much. Now we've hit the new record at 114,000, but we're also pleased to note that in the month of October, we've been able to break that record again and have come in at about 120,000 new connects for the month of October alone. So taken together with the chart that we saw during the period, the net ads for our fiber customer base was 800,000 in the nine-month period and 324,000 from the third quarter alone. So we are in good shape to exceed the target that we set for ourselves to have 1 million net new customers for our fiber business. So that's likely to be exceeded even if we're already at 800,000 as of September. Just some highlights on the various business segments, starting with the individual wireless business, of course, facing some headwinds because of the challenging conditions as a result of the limited mobility from the pandemic lockdowns, which has confined people largely to home and less need for the mobile service. The knockout effect of also the lockdown situation has been tighter consumer wallets due to job losses and obviously there's been also more active competition from Globe and Tito as the third entrant. But happy to note that our data usage continues to grow. We have 40 million data users since the end of September, averaging 7.9 GB per month. Data traffic numbers continue to be on the rise. The nine-month data traffic is up about 16%. That's driven by both the strong adoption of LTE as well as the early adoption of 5G by the customer base. And then happy to also note that the early statistics from the mobile number portability has shown smart enjoying a net gain from MMT, albeit at relatively low numbers to start off. Next, in terms of the home business, as we noted, upward momentum in our installs. has accelerated our revenue growth and we have clearly been able to show a leading performance in the market. The third quarter revenues for home business is at 12.6 billion, an all-time high, of which 9 billion is the Fiverr revenue contribution and you can contrast that to what it was at the start of 2020. The first quarter of 2020, that was only 3.8 billion, so almost three times from that standpoint. We continue to build out also our ports. We have built 1.2 billion new ports for the nine-month period, so we are well on our way to achieve or in fact exceed the 1.7 billion new ports filled out that we anticipate for this year. We've been asked what we expect if the lockdowns ease and people start to go out. We do anticipate the demand for home broadband will remain quite strong. So there will be still hybrid work and other study arrangements. The lives of people have to change forever and consumer behavior has to be changed. So a lot of dependency still on home broadband as a service to keep people connected and connected. Thank you very much. Thank you. and other corporate clients. WINS with government, the largest is the DepEdWIN where we are servicing the wireless load requirements of teachers supported by the Department of Education. We are very positive about the opportunities that 5G, IoT and especially on the hyperscaler data center business could provide moving forward. We have Red East started the planning for our 11th data center, which will have a capacity that will actually equal or actually be in excess of the combined capacity of our 10 existing data centers. We would have to work with government and other stakeholders to position the Philippines as the next Asia-Pacific hyperscaler hub as part of the growth pillar for this business. There are other digital transformation opportunities Thank you. Thank you, Charlie. We've been able to keep it relatively flat at about 1.4-1.5 billion per quarter revenues for international sign. Moving on, to recap, our increase of revenues by 9 billion. has been translating to about 5 billion EBITDA growth. We also have lower provisions this year, but of course there are some higher cash capex in some cities that we have incurred during the period. As noted also earlier, depreciation and financing costs have risen as a function of the capex investments that we've made behind the net burn. But helping us during this period is the lower income tax rate as well. Inacted through the CREATE tax law. Moving on. So on an EBITDA basis, just to also highlight, we've seen five consecutive quarters of EBITDA growth. So we've hit 24.5 billion for the third quarter. That is an all-time high, and that's an EBITDA margin of 52%. Next chart for core income. Last year, our average for this year is 7.7 billion, from 7.5, 7.7 to 7.9 billion in the third quarter below. So a 10% increase, and we are well on track to hit our 2021 full-year guidance of 30 billion telco core income. Just to see some of the other items that impact our P&L. If we include the results of Voyager, we do have some gain and dilution. So there's still a 14% increase in the core income to add Voyager. Now for the reported income, some movements, the largest one would be the swing of the FX rates from a situation where the PESO appreciated last year to one where it has depreciated this year. So there are rebound gains last year versus rebound losses last year. So that's a 3.3 billion swing year on year. So when you take into account the other numbers, costs are reported income to be a bit lower by 4% compared to what it was last year.

Next, please.

Just to highlight on the balance sheet side, our net debt is about $4.5 billion during month end September. Maturities are still pretty well spread out. The next chart is going to the CapEx number. The capex for the nine-month period ended at $63 billion. Our guidance for the year is $88 to $92 billion. At this point, we think that the capex will come in more towards the low end of that number, at around $88 billion for the year. Within the $63 billion that we spent, $47 billion for network and IT, and then there's a good $12.8 billion that supports the business growth behind the higher installation numbers that we've seen for our home, and Broadband Connection. So that number increases the result of the higher installed numbers that we saw in the first nine months. So also other highlights in terms of the growth in the data traffic that we support, there's been about 12% increase in wireless traffic and a 62% increase actually for fixed traffic such that there's about 54 petabytes per day for The traffic that we carry to our fixed network and another 11 metabytes for our mobile network. We continue to invest also behind expanding our cable capacity both for domestic and international. For international in particular, we expect the Jupiter cable systems to come on stream in the first quarter of next year, and that will significantly increase our capacity to carry international data traffic. Next chart, please. Just some highlights on the network size. Show where the capex pen has gone. In terms of our fixed line site, we now pass 12.7 million homes, which as you can appreciate is more than 50% now of the total households in the Philippines. So we have potential to connect as many as 12.7 million homes. As of the moment, we have active ports of 5.3 million available, both installed and for sale. and that is as a result of the build-out of 1.23 million boards that we've done so far this year and as I indicated, we expect to increase that by another 500,000 by year-end. Fiber footprint, by far the largest and most extensive in the country compared to any of our competitors at 615,000 cable kilometers that we've laid and that's a 42% increase from where we were at the start of the year. On the wireless side, Thank you very much. 20% for 2G, 3G, and then 5G is emerging. Part of the market now still at about 1% of the total base. Next chart. Of course, coming from a relatively low base, we now see 5G active devices of about 760,000 per month. It will clearly still grow as handsets become more affordable. Data traffic has practically doubled just for one quarter alone. In terms of how the network is performing, we are pleased to note that Kukla has indicated that the speed for 5G and smart is about practically twice the speed that you would experience on low. Other recognition of the quality of our 5G network is outlined here. So just some more metrics from the network performance side. For the average mobile download speed, we continue to lead the market with an average speed in the month of September of 51 Mbps, clearly a notch above the 35 Mbps average for the market. The blue line shows the performance measured by Upland for Globe. The red line for DETO. Next chart would be the fixed average download speed. Again, DLDT by far the fastest in this country at 92 Mbps. And that's also, again, much higher than the roughly 72 Mbps that is registered for the country. Again, you see here the download speeds for Converge, SkyCable, and Globe versus our download speeds.

Next chart.

So just to highlight for mobile, we are 1.8 times faster than the nearest competitor. We've increased from April to October by 16 Mbps versus global, which we've increased by seven, and in detail by about two. Next. Just to also showcase the awards we have received from OpenSignal, which tries to measure all of us on six metrics, download speed, upload speed, 4G coverage, video experience, voice-up experience, games experience, and Smart is clear winner across all six categories. Just to round off my presentation, just to talk about Signal, which is our paid TV affiliate. It has 3.77 million subscribers since the end of September. It's higher by about a million year-on-year, largely because of the shutdown of one of our major competitors. 3.4 million of these are prepaid and about 400,000 postpaid customers. By way of key financial metrics, total revenue is about 7.5 billion pesos, that's up 26%. Service revenue is 6.6%, 35% higher. EBITDA of almost 2 billion for the nine-month period and foreign income of close to 800 billion. Again, showing good improvements over prior years. At this stage, let me turn things over to SB or Shailesh for the Paymaya digital tap discussion.

Thank you, Anabel. If you can go to the first slide, please. So just to remind everyone, at Paymaya, we are a digital financial ecosystem where we serve consumers, we serve enterprises, and we serve communities across our three businesses in Paymaya. Whether you're a first-time Thank you for joining us. Top Up Your Airtime, you can go to our on-ground network on Smart Padla and do that. So we are able to move people seamlessly between online and face-to-face. We are able to connect the consumer and the enterprise part of the business in a unique way, which creates value propositions and a data set that is very rich and unique to us. And now we've got the Maya Bank license given to us by the VSP. Some key metrics of our performance through the course of 2020, three quarters, our number of registered customers across our consumer, both on the wallet side and our on-ground network is now at 41 million, which is a 2.7x growth above where we were at the start of 2020. When we look at our three businesses and we add that up, the gross transaction value will grow by over 50% for the course of 2021 versus last year. and when we look at our enterprise business where we are processing payments, providing merchant acceptance solutions, we are the number one in everyday category across whether you think of pharmacy, whether you think of gas, whether you think of online. And we continue to add the number of digital touchpoints in the country to enable them for digital payments and processing and today we have over 380,000 of those. If we go to the next slide, please. So just on the wallet side, The PayMyWallet makes it extremely easy and convenient whether you're a first-time-ever user of financial services to download EKYC and set up your wallet all in the span of seconds. And with that, you can then put in cash easily into the wallet so that you can start using it. So we have created the largest touchpoint of over 90,000 locations where you can add cash to your wallet. A number of those are accessible to you at free of cost to make it extremely convenient. And then, of course, you want to use your wallet for sending money, but also for paying your bills, buying goods and services, and by making sure that we make those available in the wallet with one of the most extensive set of billers, additional items to purchase, or goods to buy within the app itself. On the next slide, please. On the enterprise side of the business, this is where the enterprise is our client. Thank you very much. Merchants that we have enabled with points of acceptance has grown by 220% year on year. In fact, as part of our expansion and embracing the common QR standard in the Philippines, 160,000 of our merchant locations are now enabled to accept QRPH. We continue to grow this business with transactions growing at over 100%, and we are pretty much today the de facto provider of payment solutions for government for, like I said, everyday categories across pharmacy, gas, Fast Food, QSRs, and the likes of that. Our third key business, if we go to the next slide, please, is our Smart Padla, our on-ground network. This has expanded rapidly from about 30,000 that we had as of last year to 60,000. This network now covers pretty much the length and breadth of the Philippines. People can walk in, customers walk in over there to send money, buy a time load, pay their bills, and the likes. And we're expanding that now with this network being able to receive your international remittances directly from Western Union. And we also started our first loan product of lending, providing short-term working capital to this base through the course of 2021. If you go to the next slide, please. So that's our core business. And what we absolutely know is that people look at our digital solutions today on the payment side as convenient, as accessible, something that they can reach out to and use for their everyday transactions. Now we have got the BSP license as the sixth awardee of the digital bank license. Maya Bank now brings the credibility of being a bank to our payment network. And between the two of them, we create an absolutely compelling and unbeatable value proposition. We have the customer base, as I mentioned to you, 41 million across PayMaya. We have 1.2 million MSMEs that we can tap into and when we marry that with the data that we already have today of customers and enterprises and bring with that the ability to create a digital customer interface that will be seamless and create new products that are relevant across lending and deposit taking. And as Al mentioned earlier, our ability to tap into the MVP network, smart PLDT to be able to provide lending products, deposit products, is something that gives us access to an even larger base for us to grow out this unique combination and unbeatable combination of PayMaya plus Maya Bank. That is the update that I had. Over to you, Mr. Chairman.

Okay, thank you. Thank you, SB. I guess my job is to provide an outlook for the full year 2021, dealing with report profitability first, I think Annabelle has indicated that we reaffirmed our profit guidance at 30 billion for the full year 2021. And so we reaffirmed that for the purposes of this meeting. In terms of EBITDA, we expect to land for the full year at around 96 billion pesos. So it goes about 10% or about. CAPEX, as Annabelle indicated, we will land at around $88 billion at the lower end of the guidance we gave when we announced our first half results. And dividends maintained at 60% of core with a look back situation depending on the cash flows and the achievement, of course, of profitability for One last comment on the share price of DLT because of course in recent months we've seen an upward trend in terms of share price. We just would like to comment on whether in fact the fact that we consider Thank you very much. Assuming we value our home broadband at the level of Converge, which we think itself undervalues the home broadband, this is because we are in subspace at least 50% ahead, and in revenue share almost twice the size of our revenues purely on fixed home broadband in relation to Converge. So, and, you know, I think we've shown good growth, I think better growth than Converge has shown and I think that will continue through a number of years ahead of us. So the 120 billion differential prices, our wireless business and our enterprise business at that level, and a bit of the five or six billion of revenues of our international business. And we think that that is undeserving of that kind of valuation for its wireless enterprise and its international business. So we think in terms of market prices should be correspondingly adjusted upwards. We are aware that GCAS has been valued at around $2 billion. We, of course, don't know how much of that valuation is carried over to the global share price. Is it at the full $2 billion? Is it 35% to $2 billion? And so forth and so on. We are aware that PayMaya has quite a bit of catching up in terms of valuation of GCash, but we think that in due course it will catch up. So at the moment, our sense of devaluation of PayMaya is around a billion U.S. because the last fundraising priced PayMaya at around $747 billion, so So things have changed, have moved up in some subspace, rose transaction value, and now the digital banking device is being approved for payment. So we think it's a long period, and hopefully it will grow faster next year. So that's just about it. Thank you.

We're now ready to take your questions. You may type in your questions by clicking on the Q&A panel in the upper right side of your screen. We will now allow you to type your questions. The first one we received is from Arthur Pineda of Citibank. Can you please provide any color on how mobile revenues have trended on a monthly basis in July, August, and September? And are we seeing any improvement into October with the lifting of the ECQ?

Actually, for the past three days, we're seeing a little uplift on the top-up side. So, I suppose the increased mobility has actually had some effect already on the Thank you, Mike. We're also seeing some uplift in the postpaid activations as well. So as I guess the malls, more people are visiting the malls. We're seeing more people going to the stores to get their postpaid lines. Okay.

Thank you, Lloyd.

All right. The next question is on Mya Bank. Are there any targets on the digital bank front that can be disclosed?

Well, we definitely want to first work towards launching it in record time. So we're looking at early part of next year. to launch Maya Bank, although the BSP gives us a year from giving us the license, but we want to get there fast. We would ideally at least be looking at a million customers that we would be providing deposit services to, a million customers that we would be providing loan services to, and then from there we continue to build out with access to the existing set of customers on MSME and retail consumer side that we have, and of course across the MVP PLDT ecosystem.

A related question on Paymaya from Germán de la Cruz of Abaco Securities. What is the dollar amount of expected GTV for Paymaya in 2021?

We won't share that number just yet. We are looking at still growing the business, launching a number of new services. So we're talking about growth like we said this year. And our GTV is very different. If you look at the merchant acquiring business, as you can imagine, a GTV of that is very different from a GTV of a wallet. It's very different from a GTV... and many more. Thank you. June this year, so this was the post-money valuation.

And lastly, may I ask for Dell's stake in PayMoney? Sorry? What is the stake of DLDT in PayMoney?

38.5%.

Here's a question. Is the group looking at Starlink or low-satellite as an option to enhance data network, or will you focus on using traditional towers and base stations?

I think we are working with various satellite companies

Starting is just one option. They have a very specific solution which enables existing phones to connect to satellites. So that could be very interesting, particularly in areas where we do not have coverage, rural areas, islands, and so on and so forth. So it will be a tool in our toolbox, but not necessarily carry a large part of our traffic.

The next question comes from Taquani Morales of IGC Securities. Hi, and thank you for the presentation and congratulations on the results. My questions relate to the broadband business and are as follows. Does the company have a target to complete the migration from copper to fiber and would 100,000 plus new fiber connections per month be sustainable after completion of the migration?

Thank you. I'll answer that if it's a chaos. So the first question was around the target for the completion of the copper to fiber migration. We do anticipate the completion of copper to fiber migration to be in the first quarter of 2022. So we are on target for that plan. And in terms of do we see that demand will remain and the volumes over 100,000 a month to remain sustainable? Actually, our current volume that we saw in September of 114,000 were for new customers only. That actually does not include any of the copper to fiber migration. If you look at copper to fiber migration, you would actually add another 23,000 on top of that. So we actually are seeing copper to fiber migration as separate capacity. And this capacity, once the copper to fiber migration program has been completed in the first quarter of next year, we'll actually be using to be able to connect more new customers to our fiber network. So we do plan on actually using that additional capacity to be able to connect more new customers to our fiber network.

A question on home broadband. How much larger can the home broadband market be?

I think if you have a look at fixed-line broadband penetration in the Philippines, the market for fixed-line broadband penetration is still quite low. Depending on the number of subs count that you look at, it's somewhere between 20 and 25%. If you look at other ASEAN markets, fixed broadband penetration is somewhere between 50 and 60%. I think the last time I checked, Vietnam was already sitting at about 60%, with other markets like Thailand sitting at about 48%. So clearly, when just on a desktop exercise perspective, you look at that, there is still significant amount of growth available for fixed broadband penetration in the Philippines.

The next question is on MNP. Could you provide additional color on MNP?

Yeah, just on MNP, I think we've gotten initial numbers that there are more gross ads to Smart compared to Vito and Glow, but really the numbers are still very small. Nothing to really talk about. I think that the problem is, I think it's scaling that switching program. I think it's been very difficult for customers to to port out and port in into a new service. So I think the regulators have to help here in terms of how we can make the process easier. But yeah, it's early stages, but the numbers are not huge at this point.

Next question is from Ken Gotianze of Atram. Could you provide some color on the discussions of a possible sin in this back of your towers and how that would potentially affect your operations?

Well, as you know, we're undergoing a process on the sale and lease back. Obviously, that will, you know, cover us in terms of operations and maintenance. That will definitely help us. And I think it's really the value of the towers that we will sell and have the money, I guess, given to PLDT as we... We are also looking at the

The new build-out for our towers to be to the tower coast as well. So we have an active engagement with some of the tower companies for the undertaking of the build-out for our new requirements for this year and next year. And when we look at it, there's of course the cash flow savings from that, the APEX avoidance and the onset and even on a NPV basis to the life, there is something like 10% to 15% NPV savings for us if we undertake the build-out or the new tower roll-out through the tower company sharing arrangement versus building an RV.

The next question, what is your outlook for CapEx for next year?

Well, we're still undergoing our budget process. We have not completed that yet. We should have those figures towards our December board meeting as we present the budget to our board. But we don't have indication at this point.

We have a question on our OPEC. Selling general and administrative expenses rose by 15% year-on-year to $19.5 billion in the third quarter. May I ask the reason for this?

Selling and administrative expenses?

There are many, I guess, there are many contributors to that. Of course, part of it is in relation to the ramping up activities we have across the businesses. The other thing that, from an OPEC standpoint, is higher than prior years has been also the cost of maintaining the networks, including the repair costs, just given a bigger spread in terms of our network footprint. But that is something that we will continue to manage. The next question is on the data center business.

How big is the hyperscaler market and when do you expect to see revenues from it?

So we're still assessing the total addressable market for the Philippines, but basing it off of markets like Singapore. The data center market specific to Singapore is at about 1 billion annually, growing at a double-digit clip year-on-year. We see that the potential of the Philippines can potentially reach those levels in a couple of years. In terms of when we expect them to come in, they are coming in already. We're talking to a couple, and as part of our new data center, we're also We have a goal of landing our first anchor tenant within 2022 in Singapore.

There are no additional questions in the queue. If you have any questions, can you please type them in the Q&A box? Question in 5G. Could you explain your plans for 5G?

Well, we're at the early stages of 5G and also trying to be granular about where the users will be. So it will be a very targeted rollout on 5G for 2022, although we did have a big increase on 5G hours this year. We will be more granular next year, matching that also with the demand and availability of handsets available in the market. So very granular on the ATT&CK 2022

There are no further questions on the queue. Anybody else with questions? Otherwise, we turn the floor over to Mr. Pangilinan for his comments.

Well, thank you for joining us for this afternoon's presentation for the third quarter results. We look forward to seeing you again in the next year for the full year results. That concludes today's briefing. As always, should you have any further questions or clarifications, please reach out to PLDT Investor Relations at pldt-ir-center.com.ph.

Thank you for your participation. Stay safe.