Liberty Telecoms incurs higher net loss of P713M in H1

MANILA, Philippines - Liberty Telecoms Holdings, the telecommunications flagship of San Miguel Corp. (SMC), incurred a wider a net loss of P713 million during the first six months of 2011, from a P411 million loss in the same period last year, due to higher costs and expenses during the period.

Company officials said as a result of the group’s efforts to accelerate subscriber acquisition, ongoing infrastructure project and intensified building-up of its commercial operations, costs and expenses in the first semester amounting to P950 million P451 million spent in 2010.

This is mainly attributed to an underlying increase in selling expenses, salaries and wages, and network-related expenses such as rentals and utilities, depreciation and other expenses necessary for the operation and maintenance of its wireless broadband telecommunications network service.

However, service revenues for the six-month period reached P241 million, a 579 percent growth from P36 million posted in the same period last year, as wi-tribe Telecoms continues to acquire more subscribers for its postpaid Wi-Max broadband services.

Last February wi-tribe Telecoms obtained a P1.1-billion short-term loan from a local bank to address its funding requirements for working capital, capital expenditures and operational expenses. As of June 30, it has already drawn P950 million of the loan facility. This resulted to a corresponding increase in total liabilities by 55 percent from P1.9 billion as of Dec. 31, 2010 to P2.96 billion as of June 30, 2011.

Cash increased 137 percent or P245 million, representing the unutilized proceeds from the loan drawdown made during the period. This contributed to the seven percent increase in total assets, from P5.12 billion as of Dec. 31, 2010 to P5.46 billion as of June 30, 2011.

The Group said it is continuing the roll-out of its telecommunications network in order to make its wi-tribe broadband service available to more customers, and thereby result in the growth of the Group’s subscriber base and service revenue. The Group likewise expects to capture a portion of the market by offering reliable broadband services at competitive prices.

Liberty Telecoms is the holding company of two wholly-owned subsidiaries, namely wi-tribe Telecoms (formerly Liberty Broadcasting Network Inc.) and Skyphone Logistics.

On February 2010, wi-tribeTelecoms had its soft launch and started providing fourth generation (4G) broadband services (WIMAX) using the wi-tribe brand.