Broadband service firm Converge ICT Solutions Inc. has earmarked P20 billion in capital expenditures this year to fund its nationwide expansion efforts in a bid to poise itself as a leading fiber internet service provider.
At a press briefing on Thursday, Converge ICT chief financial office advisor Matthias Vukovich said the company increased its total capex for 2021 to P20 billion from P16 billion in 2020.
The spending program for this year will be used for the capital required for the expansion of Converge ICT’s backbone and the deployment of additional fiber-to-the-home (FTTH) ports to reach approximately 35% of households in the Philippines by December 2021.
“The budget for the backbone is approximately 30% of the P20 billion which are primarily for VisMin, we are hardening the remaining backbones in Luzon,” Vukovich said.
“Fifty percent is in the access network, we are deepening our network and a lot of that will be in Luzon, we’re just scratching the surface in Luzon, and the port deployment,” he added.
The remaining 20% of the capex will be for information technology initiatives such as digitalization efforts to enhance customer experience.
For his part, Converge ICT CEO Dennis Anthony Uy said the company is eyeing to install 1.5 million ports as part of its aim to cover 55% of total households by 2025, equivalent to at least five million residential subscribers.
So far, the company has deployed 3.5 million ports, with a network coverage reach of 25% of nationwide households.
Jesus Romero, Converge ICT’s chief operating officer, said the company is on track to reach its goal of 55% nationwide household coverage with the anticipated completion of its national backbone network expansion to the Visayas and Mindanao within the first half of the year.
“The full commercial launch of the national backbone is in the second half of 2021,” Romero said.
The company is also expecting that strong demand for reliable high-speed broadband will result in continuous growth of its residential subscriber base between 1.6 million and 1.7 million by the end of 2021.
In 2020, Converge ICT grew its subscriber base to 1,038,000 subscribers from 530,000 in 2019.
The company saw a 78% increase in net income to P3.388 billion on the back of the growth in its subscriber base.—AOL, GMA News