Ernest Cu puts brakes on Globe’s spending next year to focus on operational efficiency

Ayala-led Globe Telecom Inc. is scaling down capital spending beginning next year after record spending in the past years.

Globe said its board approved a capital budget of $1.3 billion, 30 percent lower than this year’s capex of $1.9 billion as it moves onto the next phase of its capex investment cycle.

Capital spending is expected to further go down by 2024 to $1 billion for better capital efficiency, according to Globe president and CEO Ernest Cu.

“After investing heavily on our builds and rollouts, we now have a significant backbone for our network, which allows us to shift our focus towards capital efficiency and optimization, beginning with 2023’s $1.3 billion guidance, with the target of eventually bringing this down to $1 billion by 2024,” Cu said.

Globe sees its capex investments peaking this year given the ramped up spending to take full advantage of the streamlined permitting process for the mobile network rollout in the country.

“Our aim to deliver first world connectivity to the Philippines, combined with the accelerated digitalization brought about by the pandemic have driven the company to invest significant capex into both the mobile and broadband network for the past few years,” Cu said.

The easing of capex intensity starting 2023 is being undertaken by Globe to optimize capex spending in the next few years by focusing on maximizing utilization of existing fiber assets and taking advantage of the arrangements made with tower companies to maximize tower builds.

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