The Philippines' Globe Telecom has blamed costs related to its network modernization program for a 72% slump in 1H net profit to 1.41 billion pesos ($32.4 million).
Consolidated revenue grew 9% year-on-year to 44.5 billion pesos, with mobile revenue growing by 2.6 billion pesos to 35.8 billion pesos.
Much of the mobile growth was driven by growth in the operator's postpaid brand, Globe said, while prepaid remained stable. Total mobile subscribers grew 14% year-on-year to 36.1 million.
But postpaid ARPU grew 1% during the first half to 1,206 pesos, and postpaid monthly churn increased to 1.9% from 1.8%. Prepaid ARPU declined 7% to 142 pesos.
Broadband revenues meanwhile grew 25% to 5.1 billion pesos, with subscribers increasing 15% to 1.8 million.
But depreciation costs associated with the change-out of network assets during Globe's 67 billion peso network modernization program, as well as other non-recurring costs and forex losses, led to the 72% decline in profit. Excluding these costs, core net income grew 13% to 6.4 billion pesos.
Globe president and CEO Ernest L. Cu said the major network and IT upgrade is nearing completion. As of yesterday, 73% of the operator's mobile network was on HSPA+, with 4G base stations accounting for over 6,000 of the company's 15,670 BTS total.