PLDT Inc.

Good afternoon and thank you for joining us today to discuss the company's financial and operating results for the first quarter of 2024. A copy of today's presentation is posted on our website. For those who have not been able to do so, please download the presentation at www.plbt.com under the Investor Relations section. A timely note that this briefing is being recorded. A podcast of this event will be available on our website after the call. A QR code for the presentation is on the screen and the confirmation notice is emailed to you. For today's presentation, we have with us our Chairman and President, Mr. Manny Pangidina, Sir Tani Yu, Chief Financial Officer and Chief Risk Management Officer, and Manny Pangidina Aquino, our Corporate Secretary and Chief Legal Counsel, Mr. Orlando Vea, Founder and CEO of IAF Philippines, as well as other members of the PLDT Group's management team. At this point, let me turn the floor over to Mr. Yu to begin the presentation.

Good afternoon, everyone. Allow me to share with you PLDT's financial and operating results for the first quarter of 2024. Consolidated service revenue for the first quarter grew by 3% to $48.7 billion year on year. On gross basis, service revenues were higher by 5% compared to the same period last year. Expenses grew moderately by 1% to $21.4 billion. Consolidated EBITDA rose by 5% to $27.3 billion, with EBITDA margin stood at 52%. Telco core income, excluding the impact of asset sales and Maya, expanded by 8% to $9.3 billion. Next, please. On segment basis, the strongest growth was registered by our individual or mobile business, having grown 7% or 1.3 billion to 21.1 billion in the first quarter. The enterprise segment recorded a 3% revenue increase to 12.1 billion. While home segment revenues were stable year-on-year at 15 billion, fiber revenues were higher by 7% or 900 million compared to the same period last year. Let me now go through the segments in greater detail. On this slide, we highlight that while the headline service revenue growth stood at 3%, the actual improvement excluding the drug from legacy revenue stands at 8%. In the individual segment, mobile data accounting for 88% of the total segment revenues grew by 11% year-on-year versus segment growth of 7%, which reflected the impact of the drug from legacy SMS and voice. Fiber-only revenues, which account for 92% of home segment revenues, rose 7% while the overall home segment revenue were stable year-on-year. Corporate data and ICT, the growing revenue streams under the enterprise segment were higher by 8%, stronger than the overall segment revenue increase of 3%. Next, please. Service revenues for the individual segment jumped 7% in the first quarter, reflecting strong data monetization. Blended ARPU was higher by 21% compared with a 10% rise in average usage. Note that the seasonal quarter-on-quarter dip in the first quarter was lower than the dip in the same quarter last year. Other indicators of improvement in segment performance are the increase in mobile data users to 39.4 million, an 11% growth in mobile data revenues, and a 7% rise in each of prepaid and postpaid revenues. Among the initiatives to accelerate growth are locking in customers for longer periods, driving retention with eSIMs, growing the adoption of 5G, and a structured price laddering for prepaid. Next please. 92% of revenues of the home segment are now from the fiber business. Fiber-only revenues continued to improve, recording a 7% rise year-on-year to 13.7 billion. Home fiber ARPU saw improvement year-on-year and remained at around the 1500 level. Increased focus on quality of service has helped reduce churn. Fiber churn improved to 1.82% for the first quarter of the year. PLDT is of the view that there are unserved and underserved markets in the home broadband space. These include new areas, potential customers at the lower end of the market, as well as niche markets at the higher end. PLDT continues to leverage its unique advantage of having an integrated network, which enables it to offer a suite of fixed and wireless services at different price points to cater to different segments of the market. PLDT continues to enjoy strong brand equity and superior network quality, making it a formidable competitor in the market. Next. While the enterprise segment registered a 3% year-on-year growth in the first quarter of the year, the growth from corporate data and ICT were stronger at 8%. The growth drivers were core connectivity, which grew 2% due to higher fiber and managed IT data revenues, higher ICT revenues from cloud services, EPLDT managed services, as well as technical solutions. Worth noting is the growing revenue contribution from A2P or application to phone services, which are the SMS, OTP, or one-time password messages related to online transactions. Included in our enterprise offers are differentiated SD-WAN, managed networking, and IoT platform portfolio of services. We also continue to expand our capabilities in AI and cloud. The Santa Rosa data center remains on track with the first 10 megawatts capacity expected to come on stream by July this year. Full capacity is expected to be a year ahead of competition, making EPLDT well positioned to serve the existing robots demand from hyperscalers. Total cash OPEX was moderately higher by 600 million in the first quarter, offset by decreases in cost of services, provisions, and subsidies, resulting in a minimal 1% rise in total OPEX. The company remains focused on extracting operation efficiencies as well as cost management. Consolidated EBITDA for the first three months of 2024 rose 5% to $27.3 billion, setting a new record, mainly from higher revenues. EBITDA margin stood at 52%. 2024 registered a strong start with telco core income for the quarter of 9.3 billion, higher year on year by 8% from 8.6 billion in 2023, reflecting the impact of higher EBITDA, partly upset by higher financing costs and tax progression. On reported basis, PLET income expanded by 9% to $9.8 billion, mainly from derivatives and power sales gains. Note that our share in losses from Maya for the quarter stood at about $400 million, lower than last year and consistent with the expectation of Maya's bottom-line break-even in the last quarter of 2024. PLDT's balance sheet remains healthy, with net debt to EBITDA at the end of the quarter at 2.29 times marginally better than the end of 2023. We remain focused on achieving our target leverage of 2.0 times, which we expect to attain with the anticipated increases in EBITDA, reduction in CAPEX, and with the balance of the tower sales proceeds. Gross debt amounted to $257 billion, of which 15% are dollar-denominated and 5% unhedged. Interest costs for the period stood at 12.8% pre-tax, while the average life of debt is 6.9 years. Next. Total capex for the quarter stood at 15.7 billion, consisting of network and IT capex of 14.1 billion, and business CAPEX of 1.6 billion. CAPEX intensity stood at 30% for the quarter. Of the 33 billion commitment net of advances to major CAPEX vendors, the remaining commitment has been reduced to 10.3 billion. For 2024, our CAPEX guidance is 75 to 78 billion, consistent with our aim to continue to reduce CAPEX The growth in the number of unique 5G devices and 5G data traffic continues in 2024. As mentioned earlier, growing 5G adoption is one of the growth levers of our individual business. SMAS was recently awarded 5G coverage experience award by OpenSignal. I'll turn you over to Shalesh for Maya.

Thank you, Danny. So Maya continues to be at the forefront of driving digital financial services in the Philippines. And we achieved very strong growth by leveraging our robust ecosystem across both consumers and enterprise and by putting Maya Bank, our digital bank, at the heart of it. Within two years of launch, now Maya Bank is the largest digital bank in the Philippines. And this was achieved through a delivery of innovative banking solutions. by leveraging a very large and diverse customer base comprising both various consumers and also various enterprises. Some key figures to share. By the end of March 2024, we had 3.4 million depositors. This was nearly double of the number that we had at the end of quarter one in 2023. Our deposit balance grew to 29 billion pesos, which was again a substantial increase of over 40% from the same period last year. And importantly, our loan disbursement from the launch of our loans has crossed now the 34 billion mark in terms of total loans disbursed. To give some more color across the segments, on the enterprise side, where we provide end-to-end merchant acquiring and payment processing solutions, We continue to solidify our status as the Philippines payment backbone by enabling large, small, and micro businesses to accept digital payments. To give you some idea of our size and scale, Maya processes 45% of all transactions by count and 49% by value for QRPH, the common QR standard in the Philippines, in the first quarter of 2024. We have now started providing banking services to the various businesses, allowing merchant partners to open their business deposit account digitally and offering uncollateralized short-term working capital loans to the merchants of up to two million pesos on the back of the payment business with us. On the next slide, for the consumer side of the business, we are the pioneers for high engagement banking, which gives customers a high interest rate on their savings account on the back of them doing a lot of their activity on payments, transactions, bills payment, and the likes of that, which gives us deep insight into their behavior and goes into then our credit scoring models. Combined with a strong update on our new product, Time Deposit Plus, as I mentioned, we've seen a big growth in our deposit brace to 3.4 million customers. As of December 2023, Based on the data published by ESP, the central bank, Maya accounted for 51% of the depositor base of the digital banks in the Philippines. Now, Maya Credit has been at the forefront of providing fast, convenient, short-term, unsecured loans for customers. And we have introduced new lending products like personal loans, which are of longer durations. These loans are now being offered for mobile device financing for smart customers and to PLDD home subscribers. We continue to further drive financial inclusion across the Philippines by signing up for loan channeling deals with partners who are qualified and certified digital lenders in the Philippines, starting with a FinTech lending company, global FinTech lending company, Tala, and we will continue to expand other such partnerships. So overall, we continue to see month on month and quarter on quarter strong performance and continue to see strong revenue growth and with the control on expenses, a reduction in the cash burn with the eye of getting to positive cash by the end of this year.