Filipino mobile operator Pilipino Telephone Corp (Piltel), a unit of market leader Smart Communications, reported a 38% rise in net profits to PHP13.5 billion (USD259.5 million) in the year to 31 December 2005, up from PHP9.8 billion a year earlier. The country’s third largest cellco attributed the improved performance to reduced operating costs and the one-time effects of tax credits. Piltel said expenses dropped 81% to PHP1.3 billion as a result of the significant reduction in handset costs and SIM packs sold after it stopped its SIM-swap activities in May. The drop helped offset falling revenues which tumbled from PHP15.69 billion to PHP12.36 billion, while its bottom line was also aided by PHP2.43 billion in tax benefits from deferred tax assets related to future tax credits on tax deductions such as unrealised foreign exchange losses.
Piltel ended 2005 with 4.98 million mobile subscribers, having added around 372,000 new users in the year. Sales of GSM services rose 13% from PHP8.6 billion to PHP9.7 billion and accounted for 91% of the unit’s total revenues. Capital expenditure reached PHP1.2 billion in 2005 compared to PHP1.1 billion in 2004. At end-2005 Piltel’s long-term debt stood at PHP17.7 billion, of which nearly 80% was denominated in foreign currencies.