CommsUpdate: DITO CME Holdings, the publicly listed corporate vehicle of Dennis Uy’s telecoms business DITO Telecommunity, is seeking additional funding in 2023 to support the ongoing expansion of its telecoms and digital businesses in the Philippines.
In its latest financial report the company noted: “The group has plans to do various fund-raising activities within 2023, which include a follow-on offering at the parent company level.”
Funding target unknown
Whilst it stopped short of disclosing how much it plans to raise this year, it is noteworthy that DITO CME entered into a PHP5.2 billion ($92.5 million) shareholder loan on 13 February 2023, giving it access to a credit line to cover operating expenses and maturing obligations. To date it has drawn down PHP1.3 billion from this facility.
Meanwhile, the statement also noted: “In addition, to fund the group’s expenditures regulated to the construction of the network, the group secured commitments from creditors for a project finance loan facility up to $3.9 billion, which is expected to be closed in 2023 [subject to regulatory approvals].”
By 31 December 2022, DITO Telecommunity had spent PHP230.5 billion on capital expenditure to deploy its greenfield network, and this is placing a considerable strain on the parent company’s balance sheet.
DITO CME net loss widens despite revenue growth
Due to surging costs and expenses, DITO CME’s net loss attributable to shareholders rose to PHP11.24 billion in FY 2022 from PHP9.67 billion in FY 2021. Total revenues, meanwhile, which were mainly generated by DITO Telecommunity, improved from PHP2.19 billion in 2021 to PHP7.28 billion last year.
The nascent mobile operator closed out December 2022 with 15 million subscriptions on its books, beating its projected target of signing up 10 million subscribers in 2022, despite a slow start in 2021. DITO has said it aims to build its base up to at least 28 million subscribers by the end of this year.
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