THE FUTURE IS IN OUR FIBER.
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CONTENTS
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75.3m
SUBSCRIBER
BASE
Mission/Vision
PLDT will be the preferred full service provider of
voice, video and data at the most attractive levels
of price, service quality, content and coverage,
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Company’s stakeholders.
P169.3b
TOTAL SERVICE
REVENUES
P37.3b
CORE
NET INCOME
P23.7b
BROADBAND
SERVICE
REVENUES
PLDT is the leading telecommunications service
provider in the Philippines. Through its four
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as business process outsourcing (BPO) and
others— PLDT offers the largest and most
(cid:75)(cid:80)(cid:93)(cid:76)(cid:89)(cid:90)(cid:80)(cid:196)(cid:3)(cid:76)(cid:75)(cid:3)(cid:89)(cid:72)(cid:85)(cid:78)(cid:76)(cid:3)(cid:86)(cid:77)(cid:3)(cid:91)(cid:76)(cid:83)(cid:76)(cid:74)(cid:86)(cid:84)(cid:84)(cid:92)(cid:85)(cid:80)(cid:74)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:90)(cid:3)(cid:90)(cid:76)(cid:89)(cid:93)(cid:80)(cid:74)(cid:76)(cid:90)(cid:3)
(cid:72)(cid:74)(cid:89)(cid:86)(cid:90)(cid:90)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:55)(cid:79)(cid:80)(cid:83)(cid:80)(cid:87)(cid:87)(cid:80)(cid:85)(cid:76)(cid:90)(cid:187)(cid:3)(cid:84)(cid:86)(cid:90)(cid:91)(cid:3)(cid:76)(cid:95)(cid:91)(cid:76)(cid:85)(cid:90)(cid:80)(cid:93)(cid:76)(cid:3)(cid:196)(cid:3)(cid:73)(cid:76)(cid:89)(cid:3)(cid:86)(cid:87)(cid:91)(cid:80)(cid:74)(cid:3)
(cid:73)(cid:72)(cid:74)(cid:82)(cid:73)(cid:86)(cid:85)(cid:76)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:94)(cid:80)(cid:89)(cid:76)(cid:83)(cid:76)(cid:90)(cid:90)(cid:19)(cid:3)(cid:196)(cid:3)(cid:95)(cid:76)(cid:75)(cid:3)(cid:83)(cid:80)(cid:85)(cid:76)(cid:19)(cid:3)(cid:73)(cid:89)(cid:86)(cid:72)(cid:75)(cid:73)(cid:72)(cid:85)(cid:75)(cid:3)
and satellite networks.
PLDT is listed on the Philippine Stock Exchange
(PSE:TEL) and its American Depositary Shares
are listed on the New York Stock Exchange
(NYSE:PHI). In 2012, PLDT was one of the
largest Philippine-listed companies in terms of
market capitalization.
Values
ACCOUNTABILITY
We take full responsibility for our actions
and decisions.
INTEGRITY
We do the right thing.
FAIRNESS
We uphold justice and fair play.
TRANSPARENCY
We disclose accurate and prompt information.
Subsidiaries
WIRELESS
Smart Communications, Inc. and Subsidiaries
Smart Broadband, Inc. and Subsidiaries
Chikka Holdings Limited and Subsidiaries
Digitel Mobile Philippines, Inc.
FIXED LINE
PLDT Clark Telecom, Inc.
PLDT Subic Telecom, Inc.
PLDT Global Corporation and Subsidiaries
PLDT-Philcom, Inc. and Subsidiaries
PLDT-Maratel, Inc.
Digital Telecommunications Philippines, Inc.
ePLDT, Inc. and Subsidiaries
Pilipinas Global Network Limited
BPO*
SPi Technologies, Inc. and Subsidiaries
SPi CRM, Inc.
OTHERS
PLDT Communications and Energy Ventures, Inc.
.
* On December 4, 2012, our Board of Directors authorized the sale of
our BPO segment, thus, it was classified as a disposal group held-for-
sale and discontinued operations as at December 31, 2012.
2012 ANNUAL REPORT
1
comparative highlights
FINANCIAL INFORMATION (in million pesos, except
cash dividends declared per common share)
Revenues
Service Revenues
Non-Service Revenues
Expenses
Depreciation and Amortization
(cid:3)
(cid:42)(cid:86)(cid:84)(cid:87)(cid:76)(cid:85)(cid:90)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:44)(cid:84)(cid:87)(cid:83)(cid:86)(cid:96)(cid:76)(cid:76)(cid:3)(cid:41)(cid:76)(cid:85)(cid:76)(cid:196)(cid:91)(cid:90)(cid:3)
Repairs and Maintenance
Interconnection Costs
Selling and Promotions
Cost of Sales
Professional and Other Contracted Services
Asset Impairment
Others
Net Income (Loss) for the Year
Continuing Operations
Discontinued Operations
Core Income
Continuing Operations
Discontinued Operations
EBITDA
Continuing Operations
Discontinued Operations
Property, Plant and Equipment
Accumulated Depreciation, Amortization and
Impairment
Carrying Value
Capital Expenditures
Short and Long-Term Debts
Net Debts
Equity Attributable to Equity Holders of PLDT
Cash Dividends Declared per Common Share
2008
2009
2010
2011
2012
149,334
2,709
152,043
151,706
2,426
154,132
148,597
2,217
150,814
145,834
2,645
148,479
160,189
3,295
163,484
24,151
(cid:24)(cid:28)(cid:19)(cid:25)(cid:23)(cid:27)(cid:3)
8,216
14,655
5,561
5,252
4,014
3,118
10,822
90,993
35,298
37,215
(1,917)
38,079
38,923
(844)
87,741
87,155
586
25,159
(cid:24)(cid:30)(cid:19)(cid:29)(cid:28)(cid:27)(cid:3)
8,261
14,030
5,705
5,432
3,898
5,008
11,024
96,171
40,095
40,676
(581)
41,138
41,701
(563)
86,194
85,575
619
25,881
(cid:24)(cid:32)(cid:19)(cid:24)(cid:27)(cid:31)(cid:3)
9,087
13,928
5,244
4,771
4,462
1,420
10,735
94,676
40,259
40,744
(485)
42,028
41,486
542
83,717
82,660
1,057
27,539
(cid:24)(cid:28)(cid:19)(cid:23)(cid:31)(cid:32)(cid:3)
10,053
12,586
7,807
5,443
5,143
10,200
12,242
106,102
31,637
30,806
831
39,035
38,282
753
79,959
78,547
1,412
32,354
23,042
12,604
11,556
9,708
8,747
5,361
5,286
15,365
124,023
35,401
34,741
660
37,333
36,665
668
77,258
75,632
1,626
377,220
390,692
416,390
481,647
481,033
216,894
160,326
25,203
73,911
33,557
105,531
229,436
161,256
28,069
98,729
56,586
98,575
253,206
163,184
28,766
89,646
52,299
97,069
281,505
200,142
31,207
117,275
70,660
151,833
280,955
200,078
36,396
115,792
78,057
149,060
Out of Earnings for the Year
200
218
222
189
172
OPERATING INFORMATION
Number of Cellular Subscribers
Number of Fixed Line Subscribers
Number of Broadband Subscribers
Wireless
Fixed Line
35,224,604
41,328,641
45,636,008
63,696,629
69,866,458
1,782,356
1,816,541
1,822,105
2,166,295
2,063,794
995,916
547,090
448,826
1,614,407
1,037,720
2,021,004
2,928,369
3,262,884
1,355,977
2,068,409
2,359,024
576,687
665,027
859,960
Number of Stockholders
2,183,666
2,183,194
2,182,391
2,181,823
Number of Employees
Wireless
Fixed Line
BPO
29,904
5,602
7,813
16,489
29,035
5,507
7,947
15,581
28,770
5,165
9,572
14,033
34,116
8,043
11,409
14,664
903,860
12,169
36,740
8,513
10,462
17,765
(cid:59)(cid:79)(cid:76)(cid:3)(cid:25)(cid:23)(cid:23)(cid:31)(cid:20)(cid:25)(cid:23)(cid:24)(cid:24)(cid:3)(cid:89)(cid:76)(cid:90)(cid:92)(cid:83)(cid:91)(cid:90)(cid:3)(cid:79)(cid:72)(cid:93)(cid:76)(cid:3)(cid:73)(cid:76)(cid:76)(cid:85)(cid:3)(cid:72)(cid:75)(cid:81)(cid:92)(cid:90)(cid:91)(cid:76)(cid:75)(cid:3)(cid:91)(cid:86)(cid:3)(cid:89)(cid:76)(cid:197)(cid:76)(cid:74)(cid:91)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:75)(cid:80)(cid:90)(cid:74)(cid:86)(cid:85)(cid:91)(cid:80)(cid:85)(cid:92)(cid:76)(cid:75)(cid:3)(cid:86)(cid:87)(cid:76)(cid:89)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:90)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:90)(cid:91)(cid:72)(cid:91)(cid:76)(cid:84)(cid:76)(cid:85)(cid:91)(cid:3)(cid:86)(cid:77)(cid:3)(cid:196)(cid:85)(cid:72)(cid:85)(cid:74)(cid:80)(cid:72)(cid:83)(cid:3)(cid:87)(cid:86)(cid:90)(cid:80)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:72)(cid:90)(cid:3)(cid:72)(cid:91)(cid:3)(cid:43)(cid:76)(cid:74)(cid:76)(cid:84)(cid:73)(cid:76)(cid:89)(cid:3)(cid:26)(cid:24)(cid:19)(cid:3)(cid:25)(cid:23)(cid:24)(cid:24)(cid:3)(cid:79)(cid:72)(cid:93)(cid:76)(cid:3)(cid:73)(cid:76)(cid:76)(cid:85)(cid:3)
(cid:72)(cid:75)(cid:81)(cid:92)(cid:90)(cid:91)(cid:76)(cid:75)(cid:3)(cid:91)(cid:86)(cid:3)(cid:89)(cid:76)(cid:197)(cid:76)(cid:74)(cid:91)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:72)(cid:75)(cid:81)(cid:92)(cid:90)(cid:91)(cid:84)(cid:76)(cid:85)(cid:91)(cid:3)(cid:84)(cid:72)(cid:75)(cid:76)(cid:3)(cid:91)(cid:86)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:87)(cid:89)(cid:86)(cid:93)(cid:80)(cid:90)(cid:80)(cid:86)(cid:85)(cid:72)(cid:83)(cid:3)(cid:72)(cid:84)(cid:86)(cid:92)(cid:85)(cid:91)(cid:90)(cid:3)(cid:92)(cid:90)(cid:76)(cid:75)(cid:3)(cid:80)(cid:85)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:87)(cid:92)(cid:89)(cid:74)(cid:79)(cid:72)(cid:90)(cid:76)(cid:3)(cid:87)(cid:89)(cid:80)(cid:74)(cid:76)(cid:3)(cid:80)(cid:85)(cid:3)(cid:89)(cid:76)(cid:83)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:91)(cid:86)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:72)(cid:74)(cid:88)(cid:92)(cid:80)(cid:90)(cid:80)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:86)(cid:77)(cid:3)(cid:43)(cid:80)(cid:78)(cid:80)(cid:91)(cid:76)(cid:83)(cid:21)
2
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY
consolidated financial
performance highlights
160.2b
200
150
149.3
151.7
148.6
145.8
160.2
48.5
50.2
49.5
49.3
51.3
100
50
0
80
70
60
50
40
30
20
10
0
100.8
101.5
99.1
96.5
108.9
08 09 10 11 12
SERVICE
REVENUES
(Php in billions)
Wireless
Fixed
75.3m
75.3
3.3
2.1
68.8
2.9
2.2
49.4
2.0
1.8
44.7
1.6
1.8
38.0
1.0
1.8
35.2
41.3
45.6
63.7
69.9
08 09 10 11 12
SUBSCRIBER
BASE
(in millions)
Wireless
Fixed
Broadband
100
80
60
40
20
0
90
80
70
60
50
40
30
20
10
0
77.3b
37.3b
50
87.7
86.2
83.2
80.0
77.3
41.1
42.0
40
38.1
39.0
37.3
30
20
10
0
600
500
400
300
200
100
0
08 09 10 11 12
CORE INCOME
(Php in billions)
546.6b
545.1
546.6
489.4
477.0
396.5
08 09 10 11 12
MARKET
CAPITALIZATION
(Year-end, Php in billions)
08 09 10 11 12
EBITDA
(Php in billions)
80.4b
78.3
77.3
74.4
79.2
80.4
08 09 10 11 12
CASH FLOW
FROM
OPERATIONS
(Php in billions)
2012 ANNUAL REPORT
3
A message from the
chairman
We are not looking
forward to simply
restoring past levels of
revenue. Our aim is to
reboot growth on
a future-friendly basis by
pursuing great synergies
(cid:72)(cid:85)(cid:75)(cid:3)(cid:80)(cid:84)(cid:87)(cid:89)(cid:86)(cid:93)(cid:76)(cid:75)(cid:3)(cid:76)(cid:77)(cid:196)(cid:74)(cid:80)(cid:76)(cid:85)(cid:74)(cid:80)(cid:76)(cid:90)(cid:3)
throughout the now
expanded PLDT Group
and by developing
innovative data and
multimedia services
which can thrive in an
increasingly disruptive
digital, social media-
driven world.
4
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY
THE FUTURE IS IN OUR FIBER
AFTER PATIENT, STEADY EFFORTS WHICH STARTED AS FAR BACK AS 2010,
YOUR COMPANY IS NOW READY FOR RENEWED GROWTH IN 2013 AND BEYOND.
We are not looking forward to simply restoring past levels
of revenue. Our aim is to reboot growth on a future-
friendly basis by pursuing great synergies and improved
(cid:76)(cid:77)(cid:196)(cid:3)(cid:74)(cid:80)(cid:76)(cid:85)(cid:74)(cid:80)(cid:76)(cid:90)(cid:3) (cid:91)(cid:79)(cid:89)(cid:86)(cid:92)(cid:78)(cid:79)(cid:86)(cid:92)(cid:91)(cid:3) (cid:91)(cid:79)(cid:76)(cid:3) (cid:85)(cid:86)(cid:94)(cid:3) (cid:76)(cid:95)(cid:87)(cid:72)(cid:85)(cid:75)(cid:76)(cid:75)(cid:3) (cid:55)(cid:51)(cid:43)(cid:59)(cid:3) (cid:46)(cid:89)(cid:86)(cid:92)(cid:87)(cid:3)
and by developing innovative data and multimedia services
which can thrive in an increasingly disruptive digital, social
media-driven world.
We have reached this juncture by pursuing major
transformation activities within the Group.
PURSUING TRANSFORMATION
First, we completed our massive Php67.4 billion network
(cid:91)(cid:89)(cid:72)(cid:85)(cid:90)(cid:77)(cid:86)(cid:89)(cid:84)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:87)(cid:89)(cid:86)(cid:78)(cid:89)(cid:72)(cid:84)(cid:3)(cid:77)(cid:86)(cid:89)(cid:3)(cid:86)(cid:92)(cid:89)(cid:3)(cid:196)(cid:3)(cid:95)(cid:76)(cid:75)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:84)(cid:86)(cid:73)(cid:80)(cid:83)(cid:76)(cid:3)(cid:85)(cid:76)(cid:91)(cid:94)(cid:86)(cid:89)(cid:82)(cid:90)(cid:21)(cid:3)
This has enabled us to extend and improve our basic
services as well as commence offering cutting-edge
(cid:73)(cid:89)(cid:86)(cid:72)(cid:75)(cid:73)(cid:72)(cid:85)(cid:75)(cid:3) (cid:90)(cid:76)(cid:89)(cid:93)(cid:80)(cid:74)(cid:76)(cid:90)(cid:3) (cid:90)(cid:92)(cid:74)(cid:79)(cid:3) (cid:72)(cid:90)(cid:3) (cid:196)(cid:3)(cid:73)(cid:76)(cid:89)(cid:20)(cid:91)(cid:86)(cid:20)(cid:91)(cid:79)(cid:76)(cid:20)(cid:79)(cid:86)(cid:84)(cid:76)(cid:3) (cid:15)(cid:45)(cid:59)(cid:59)(cid:47)(cid:16)(cid:3)
(cid:86)(cid:85)(cid:3)(cid:86)(cid:92)(cid:89)(cid:3)(cid:196)(cid:3)(cid:95)(cid:76)(cid:75)(cid:3)(cid:83)(cid:80)(cid:85)(cid:76)(cid:3)(cid:85)(cid:76)(cid:91)(cid:94)(cid:86)(cid:89)(cid:82)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:51)(cid:86)(cid:85)(cid:78)(cid:20)(cid:59)(cid:76)(cid:89)(cid:84)(cid:3)(cid:44)(cid:93)(cid:86)(cid:83)(cid:92)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:15)(cid:51)(cid:59)(cid:44)(cid:16)(cid:3)
on our mobile networks. These high-speed access
(cid:91)(cid:76)(cid:74)(cid:79)(cid:85)(cid:86)(cid:83)(cid:86)(cid:78)(cid:80)(cid:76)(cid:90)(cid:3) (cid:72)(cid:89)(cid:76)(cid:3) (cid:92)(cid:85)(cid:75)(cid:76)(cid:89)(cid:87)(cid:80)(cid:85)(cid:85)(cid:76)(cid:75)(cid:3) (cid:73)(cid:96)(cid:3) (cid:55)(cid:51)(cid:43)(cid:59)(cid:187)(cid:90)(cid:3) (cid:76)(cid:95)(cid:91)(cid:76)(cid:85)(cid:90)(cid:80)(cid:93)(cid:76)(cid:3) (cid:196)(cid:3)(cid:73)(cid:76)(cid:89)(cid:3)
optic network, which is the country’s most extensive,
robust and resilient.
(cid:58)(cid:76)(cid:74)(cid:86)(cid:85)(cid:75)(cid:19)(cid:3)(cid:94)(cid:76)(cid:3)(cid:79)(cid:72)(cid:93)(cid:76)(cid:3)(cid:89)(cid:76)(cid:74)(cid:86)(cid:85)(cid:196)(cid:3)(cid:78)(cid:92)(cid:89)(cid:76)(cid:75)(cid:3)(cid:86)(cid:92)(cid:89)(cid:3)(cid:86)(cid:89)(cid:78)(cid:72)(cid:85)(cid:80)(cid:97)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:91)(cid:86)(cid:3)(cid:72)(cid:75)(cid:75)(cid:89)(cid:76)(cid:90)(cid:90)(cid:3)
more effectively our key markets – Home, Individual and
Enterprise. PLDT, ePLDT, Digitel, Smart and Cellular (Sun)
have put in place a mesh of collaborative mechanisms
that allow these organizations to work cohesively in
serving our various customers – whether they be large
corporations at home or Filipino workers overseas.
Third, we have methodically pursued synergies within
the Group to ensure that we serve our customers in the
(cid:84)(cid:86)(cid:90)(cid:91)(cid:3)(cid:74)(cid:86)(cid:90)(cid:91)(cid:20)(cid:76)(cid:77)(cid:196)(cid:3)(cid:74)(cid:80)(cid:76)(cid:85)(cid:91)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:76)(cid:77)(cid:77)(cid:76)(cid:74)(cid:91)(cid:80)(cid:93)(cid:76)(cid:3)(cid:94)(cid:72)(cid:96)(cid:90)(cid:21)(cid:3)(cid:59)(cid:79)(cid:80)(cid:90)(cid:3)(cid:79)(cid:72)(cid:90)(cid:3)(cid:80)(cid:85)(cid:93)(cid:86)(cid:83)(cid:93)(cid:76)(cid:75)(cid:3)
taking major decisions such as migrating Digitel’s landline
subscribers to PLDT because the
landline
network was nearing its end-of-life stage and would be
(cid:87)(cid:89)(cid:86)(cid:78)(cid:89)(cid:76)(cid:90)(cid:90)(cid:80)(cid:93)(cid:76)(cid:83)(cid:96)(cid:3)(cid:75)(cid:80)(cid:77)(cid:196)(cid:3)(cid:74)(cid:92)(cid:83)(cid:91)(cid:3)(cid:91)(cid:86)(cid:3)(cid:86)(cid:87)(cid:76)(cid:89)(cid:72)(cid:91)(cid:76)(cid:21)
former’s
As I indicated in my message last year, 2012 was a
(cid:75)(cid:80)(cid:77)(cid:196)(cid:3)(cid:74)(cid:92)(cid:83)(cid:91)(cid:3) (cid:87)(cid:76)(cid:89)(cid:80)(cid:86)(cid:75)(cid:3) (cid:89)(cid:76)(cid:87)(cid:89)(cid:76)(cid:90)(cid:76)(cid:85)(cid:91)(cid:80)(cid:85)(cid:78)(cid:3) (cid:86)(cid:92)(cid:89)(cid:3) (cid:64)(cid:76)(cid:72)(cid:89)(cid:3) (cid:77)(cid:86)(cid:89)(cid:3) (cid:40)(cid:83)(cid:80)(cid:78)(cid:85)(cid:84)(cid:76)(cid:85)(cid:91)(cid:21)(cid:3) (cid:62)(cid:76)(cid:3)
(cid:91)(cid:86)(cid:86)(cid:82)(cid:3)(cid:86)(cid:85)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:74)(cid:79)(cid:72)(cid:83)(cid:83)(cid:76)(cid:85)(cid:78)(cid:80)(cid:85)(cid:78)(cid:3)(cid:87)(cid:89)(cid:86)(cid:74)(cid:76)(cid:90)(cid:90)(cid:3)(cid:86)(cid:77)(cid:3)(cid:89)(cid:76)(cid:72)(cid:83)(cid:80)(cid:97)(cid:80)(cid:85)(cid:78)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:73)(cid:76)(cid:85)(cid:76)(cid:196)(cid:3)(cid:91)(cid:90)(cid:3)
of the Digitel acquisition even as we contended with
intense competition from other telcos but also, and
perhaps more strategically, from over the top players of
the internet world.
TRANSITIONAL DYNAMICS
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dynamics. In line with our guidance, consolidated core
net income reached Php37.4 billion, which was 4% below
(cid:91)(cid:79)(cid:76)(cid:3) (cid:196)(cid:3)(cid:78)(cid:92)(cid:89)(cid:76)(cid:3) (cid:77)(cid:86)(cid:89)(cid:3) (cid:25)(cid:23)(cid:24)(cid:24)(cid:21)(cid:3) (cid:57)(cid:76)(cid:87)(cid:86)(cid:89)(cid:91)(cid:76)(cid:75)(cid:3) (cid:85)(cid:76)(cid:91)(cid:3) (cid:80)(cid:85)(cid:74)(cid:86)(cid:84)(cid:76)(cid:19)(cid:3) (cid:86)(cid:85)(cid:3) (cid:91)(cid:79)(cid:76)(cid:3) (cid:3) (cid:86)(cid:91)(cid:79)(cid:76)(cid:89)(cid:3)
hand, was up 12% at Php35.5 billion. Moreover, total
service revenues rose 10% to Php160.2 billion, after two
years of decline.
What is worth noting, though, is that the 2012 second
semester core net income of Php18.7 billion was 4%
higher from the second semester of the previous year.
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core net income for 2013 of Php38.3 billion, a gain of
about one billion pesos after two years of decline.
EXECUTION AND INNOVATION
To maintain our growth momentum, we need to focus on
execution and innovation.
Excellent execution is the key to implementing synergy
programs that we have developed to capitalize on the
Digitel acquisition. We have already realized some of
these gains, such as capital expenditures (capex) savings
by harmonizing network investments. Moving on into
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an unprecedented degree of coordination among PLDT,
ePLDT, Digitel, Smart, and Sun Cellular.
This is no small task given the divergent histories,
cultures and dynamics of the various organizations within
the Group. But this is absolutely necessary if we are to
combine the strengths of the various companies and
move forward as one Group.
To their credit, the leaders of the Group’s various business
units have approached this process with an openness of mind
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a common culture along with processes and practices to
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Execution is also critical in taking advantage of the
huge competitive advantage that PLDT has acquired by
completing its network transformation far ahead of the
competition. Our accelerated capex program in 2011 and
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network to over 54,000 kilometers and we are now in
2012 ANNUAL REPORT
5
P67.4b
NETWORK
TRANSFORMATION
PROGRAM
54,000km
FIBER OPTIC
NETWORK
over70%
3G POPULATION
COVERAGE
14
EXCELLENCE AWARDS
11TH PHILIPPINE
QUILL AWARDS
over500
PUBLIC SCHOOL
TEACHER
SCHOLARSHIPS
P100m
RAISED BY
TULONG KAPATID
the process of laying down 5,000 kilometers more. We
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3G population coverage to over 70%, grown the reach
of our FTTH facilities and expanded the coverage of our
LTE service. PLDT is, thus, well-positioned to grow its
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penetration rapidly growing and social media driving
usage, mobile data promises to be a key source of growth
in the coming years.
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(cid:91)(cid:86)(cid:3) (cid:73)(cid:76)(cid:74)(cid:86)(cid:84)(cid:76)(cid:3) (cid:84)(cid:92)(cid:74)(cid:79)(cid:3) (cid:84)(cid:86)(cid:89)(cid:76)(cid:3) (cid:87)(cid:89)(cid:86)(cid:83)(cid:80)(cid:196)(cid:74)(cid:3) (cid:72)(cid:85)(cid:75)(cid:3) (cid:77)(cid:86)(cid:74)(cid:92)(cid:90)(cid:76)(cid:75)(cid:3) (cid:80)(cid:85)(cid:3) (cid:86)(cid:92)(cid:89)(cid:3)
innovations as we transform PLDT into a communications
and multimedia services Group in an environment where
the telco, media and internet worlds are merging at an
accelerating pace.
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trend. Our investment via Philippine Depository Receipts
(PDRs) in CignalTV places us at the cutting edge of
opportunities arising from the convergence of access and
content.
At the same time, we are nurturing innovation through
out-of-the-box approaches both inside and outside our
organization. Our wireless subsidiary Smart, for example,
has set up a new business unit that has been given the
mandate and the means to develop new business ideas
that can be adopted by other units within the Group.
We are also fostering the development of innovative
businesses through the IdeaSpace Foundation which
provides incubator and accelerator support for small
tech start ups selected through a national competition.
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assisted in turning their ideas into commercial products
and services.
HARVEST OF AWARDS
Thankfully, your Company’s efforts in business innovation,
corporate governance and community service have won
recognition here and abroad.
PLDT won the Best CEO awards from Finance Asia
(for the undersigned) and Corporate Governance Asia
(for Napoleon L. Nazareno), both prestigious regional
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also named PLDT Best in Corporate Governance in the
Philippines while the Institute of Corporate Directors of
the Philippines cited PLDT as a Platinum Plus Awardee
in Corporate Governance. PLDT was also cited as the
Carrier Ethernet Service Provider of the Year for Asia
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Shanghai, China.
Smart bagged awards for Operator of the Year and
Telecom CEO of the Year (for Napoleon L. Nazareno) at
the 15th Telecom Asia Awards held in Bangkok, Thailand.
It also won the Operator of the Year and Innovation Award
for the Smart Netphone at the 2nd Asia Communications
Award held in Singapore, and The Most Innovative
Company Award at the Asia CEO Awards held in Manila.
Its mHealth program, Secured Health Information Network
and Exchange (SHINE), won two international awards and
was also named as one of the country’s Top 10 health
program by Health Market Innovations at the 2nd Galing
Likha-Kalusugan Awards held in Manila.
Moreover, Smart was cited as the Company of the Year
at the 11th Philippine Quill Awards for winning a record-
setting 14 Excellence Awards at the annual competition
held by
International Association of Business
Communicators Philippines. It also garnered 14 awards
at the 48th Anvil Awards, the second year in a row that it
topped the trophy count at the annual event of the Public
Relations Society of the Philippines.
the
6
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY
Finally, Sun was recognized as the Philippines’ Mobile
Service Provider of the Year for 2012 by Frost & Sullivan
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year that Sun received that distinction from the global
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CONSORTIUM FOR CORPORATE ACTION
In 2012, we raised the level of our community service
programs establishing stronger partnerships with our kindred
companies. This was particularly true in two areas: disaster
preparedness and response, and entrepreneurship.
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Investments Corporation (MPIC), Manila Electric Company
(Meralco), Maynilad Water Services, Inc. (Maynilad) and
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our coordinated disaster preparedness and response
program. The following month, on December 5, (cid:59)(cid:96)(cid:87)(cid:79)(cid:86)(cid:86)(cid:85)(cid:3)
Pablo(cid:3)(cid:90)(cid:91)(cid:89)(cid:92)(cid:74)(cid:82)(cid:3)(cid:90)(cid:86)(cid:92)(cid:91)(cid:79)(cid:76)(cid:72)(cid:90)(cid:91)(cid:76)(cid:89)(cid:85)(cid:3)(cid:52)(cid:80)(cid:85)(cid:75)(cid:72)(cid:85)(cid:72)(cid:86)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:80)(cid:85)(cid:197)(cid:80)(cid:74)(cid:91)(cid:76)(cid:75)(cid:3)(cid:79)(cid:86)(cid:89)(cid:89)(cid:80)(cid:196)(cid:74)(cid:3)
death and destruction in the provinces of Davao Oriental
and Compostela Valley.
followed has provided PLDT and
its allied
What
companies a template for working together in dealing
with calamities. (cid:59)(cid:92)(cid:83)(cid:86)(cid:85)(cid:78)(cid:3)(cid:50)(cid:72)(cid:87)(cid:72)(cid:91)(cid:80)(cid:75)(cid:3)raised more than Php100
million via a telethon on ABC Associated Broadcasting
(TV5). Working
Company Development Corporation
together, TV5, Smart, PLDT and Meralco distributed
relief goods, ready-to-eat food and water to several tens
of thousands of displaced residents of the two hard-hit
provinces over several weeks. Maynilad deployed its
(cid:84)(cid:86)(cid:73)(cid:80)(cid:83)(cid:76)(cid:3) (cid:94)(cid:72)(cid:91)(cid:76)(cid:89)(cid:3) (cid:196)(cid:83)(cid:91)(cid:89)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3) (cid:90)(cid:91)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:21)(cid:3) (cid:43)(cid:86)(cid:74)(cid:91)(cid:86)(cid:89)(cid:90)(cid:3) (cid:72)(cid:85)(cid:75)(cid:3) (cid:85)(cid:92)(cid:89)(cid:90)(cid:76)(cid:90)(cid:3) (cid:77)(cid:89)(cid:86)(cid:84)(cid:3)
the Davao Doctors Hospital and Makati Medical Center
staged medical missions that served several thousands
of people in New Bataan and Compostela Poblacion in
Compostela Valley.
Smart set up free call stations for typhoon victims and,
working with Telecoms Sans Frontieres and Vodafone
Foundation, also installed an lnstant Network, using a
(cid:87)(cid:86)(cid:89)(cid:91)(cid:72)(cid:73)(cid:83)(cid:76)(cid:3)(cid:74)(cid:76)(cid:83)(cid:83)(cid:3)(cid:90)(cid:80)(cid:91)(cid:76)(cid:3)(cid:91)(cid:79)(cid:72)(cid:91)(cid:3)(cid:196)(cid:91)(cid:90)(cid:3)(cid:80)(cid:85)(cid:91)(cid:86)(cid:3)(cid:77)(cid:86)(cid:92)(cid:89)(cid:3)(cid:90)(cid:92)(cid:80)(cid:91)(cid:3)(cid:74)(cid:72)(cid:90)(cid:76)(cid:90)(cid:19)(cid:3)(cid:91)(cid:86)(cid:3)(cid:87)(cid:89)(cid:86)(cid:93)(cid:80)(cid:75)(cid:76)(cid:3)(cid:84)(cid:86)(cid:73)(cid:80)(cid:83)(cid:76)(cid:3)
phone service to relief agencies in Davao Oriental. Meralco
deployed 38 linemen to help the local electric cooperative
restore power in the towns of Cateel and Banganga.
In partnership with the Davao Oriental provincial government
and the National Housing Authority (NHA). (cid:59)(cid:92)(cid:83)(cid:86)(cid:85)(cid:78)(cid:3)(cid:50)(cid:72)(cid:87)(cid:72)(cid:91)(cid:80)(cid:75)
is now building about 300 homes in Banganga for families
displaced by the typhoon.
In entrepreneurship, PLDT, working once more with its
(cid:72)(cid:77)(cid:196)(cid:83)(cid:80)(cid:72)(cid:91)(cid:76)(cid:75)(cid:3) (cid:74)(cid:86)(cid:84)(cid:87)(cid:72)(cid:85)(cid:80)(cid:76)(cid:90)(cid:19)(cid:3) (cid:83)(cid:72)(cid:92)(cid:85)(cid:74)(cid:79)(cid:76)(cid:75)(cid:3) (cid:91)(cid:79)(cid:76)(cid:3) (cid:83)(cid:72)(cid:89)(cid:78)(cid:76)(cid:90)(cid:91)(cid:3) (cid:87)(cid:89)(cid:80)(cid:93)(cid:72)(cid:91)(cid:76)(cid:3) (cid:90)(cid:76)(cid:74)(cid:91)(cid:86)(cid:89)(cid:3)
initiative to promote tech startups in the country. As I
noted earlier, IdeaSpace Foundation held a nationwide
(cid:74)(cid:86)(cid:85)(cid:91)(cid:76)(cid:90)(cid:91)(cid:3)(cid:91)(cid:86)(cid:3)(cid:90)(cid:76)(cid:83)(cid:76)(cid:74)(cid:91)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:196)(cid:89)(cid:90)(cid:91)(cid:3)(cid:91)(cid:76)(cid:85)(cid:3)(cid:91)(cid:76)(cid:74)(cid:79)(cid:3)(cid:90)(cid:91)(cid:72)(cid:89)(cid:91)(cid:3)(cid:92)(cid:87)(cid:90)(cid:3)(cid:91)(cid:79)(cid:72)(cid:91)(cid:3)(cid:94)(cid:80)(cid:83)(cid:83)(cid:3)(cid:76)(cid:72)(cid:74)(cid:79)(cid:3)
receive funding of up to Php5 million plus mentoring,
logistics and legal assistance to translate their innovative
ideas into commercial reality.
In the same vein, PLDT launched Project Pagsulong, a
Php1 million national competition among young Filipinos
to develop innovative business ideas that provide real-
life solutions to poverty. The three winning teams have
received cash grants, and pre- and post-project coaching
and mentoring from partner institutions.
In education, PLDT’s Gabay Guro continued to expand its
reach, providing scholarships to over 500 public school
teachers in state universities and colleges all over the
country. It now plans to further extend its support for public
school teachers by working with local governments and
over 30 partner state colleges and universities. The target
(cid:80)(cid:90)(cid:3)(cid:91)(cid:86)(cid:3)(cid:76)(cid:93)(cid:76)(cid:85)(cid:91)(cid:92)(cid:72)(cid:83)(cid:83)(cid:96)(cid:3)(cid:79)(cid:72)(cid:93)(cid:76)(cid:3)(cid:196)(cid:93)(cid:76)(cid:3)(cid:90)(cid:74)(cid:79)(cid:86)(cid:83)(cid:72)(cid:89)(cid:90)(cid:3)(cid:87)(cid:76)(cid:89)(cid:3)(cid:96)(cid:76)(cid:72)(cid:89)(cid:3)(cid:87)(cid:76)(cid:89)(cid:3)(cid:87)(cid:89)(cid:86)(cid:93)(cid:80)(cid:85)(cid:74)(cid:76)(cid:21)
in
Our other education programs are evolving
the
direction of going increasingly digital and online. PLDT’s
Infoteach Outreach Program (Infoteach) is strengthening
its partnership with the University of the Philippines Open
University (UPOU) to provide advanced online training for
teachers from its partner public schools. The Smart Schools
Program is placing greater emphasis on multimedia content
generation through its Doon Po Sa Amin Program. The
Smart Wireless Engineering Education Program (SWEEP)
has introduced mobile applications development in its annual
innovation competition.
Finally, in sports, PLDT continued to support Philippine
sports vigorously, particularly basketball, football, boxing
and taekwondo. We are preparing well for the FIBA Asia
Championship that will be held in Manila in August 2013.
The reorganized Smart Gilas National Basketball Team
has trained strenuously for this competition that will
hopefully pave the way for Philippine participation in the
FIBA World Cup in Spain in 2014.
OUTLOOK
Through its investments and transformation initiatives, the
PLDT Group has positioned itself well in the emerging digital
and multimedia world. We shall maintain and strengthen our
leadership by embracing both incremental and disruptive
changes.
Attaining these goals requires far-sighted leadership,
(cid:72)(cid:85)(cid:3) (cid:72)(cid:78)(cid:80)(cid:83)(cid:76)(cid:3) (cid:72)(cid:85)(cid:75)(cid:3) (cid:197)(cid:76)(cid:95)(cid:80)(cid:73)(cid:83)(cid:76)(cid:3) (cid:86)(cid:89)(cid:78)(cid:72)(cid:85)(cid:80)(cid:97)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3) (cid:72)(cid:85)(cid:75)(cid:3) (cid:72)(cid:3) (cid:90)(cid:80)(cid:85)(cid:78)(cid:83)(cid:76)(cid:20)(cid:84)(cid:80)(cid:85)(cid:75)(cid:76)(cid:75)(cid:3)
focus on delivering the best possible service at the most
affordable prices to our customers. The road ahead is
long and steep, but the challenges are exciting.
In closing, I wish to thank our shareholders for their
support and the Board of Directors for their determination
and dedication in building a new future for PLDT.
MANUEL V. PANGILINAN
Chairman of the Board
2012 ANNUAL REPORT
7
A letter from the
president & CEO
We are fully aware that PLDT
is pursuing growth within
a very dynamic industry
environment. As the world
of telecoms, the internet and
media come together, we
are constantly monitoring
and evaluating how these
changes may impact our
business. Our strategy is
to embrace change and to
get ahead of the curve. The
repositioning of our portfolio
and our greater involvement
in the media/content
business is part of a far-
reaching transformation that
aims to strengthen PLDT’s
leadership in the emerging
digital world.
8
8
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY
2013: RETURN TO GROWTH
DEAR FELLOW SHAREHOLDERS:
THE YEAR 2012 WAS A YEAR OF TRANSITION FOR PLDT. WE UNDERTOOK THE
STEP-BY-STEP PROCESS OF ASSIMILATING DIGITEL AND SUN CELLULAR INTO THE
GROUP. WE COMPLETED AHEAD OF SCHEDULE OUR NETWORK TRANSFORMATION
PROGRAM, ENABLING US TO DEPLOY HIGH-SPEED BROADBAND IN BOTH PLDT’S
FIXED NETWORK AND SMART’S CELLULAR NETWORK. FACED WITH INTENSE
COMPETITION, THE GROUP STRENGTHENED
ITS POSITION
IN THE MOBILE
BUSINESS. WE RATIONALIZED OUR BUSINESS PORTFOLIO, LEADING TO THE SALE
OF OUR OUTSOURCING BUSINESS AND MOVED TOWARDS GREATER INVOLVEMENT
IN THE MULTIMEDIA SPACE.
OUR FINANCIAL AND OPERATING RESULTS FOR 2012 WERE SHAPED BY THIS
TRANSITION PROCESS.
Reported net income rose by 12% to Php35.4 billion. As
anticipated, core income, excluding exceptional items, was
lower at Php37.3 billion from Php39 billion in 2011 largely
(cid:89)(cid:76)(cid:197)(cid:3)(cid:76)(cid:74)(cid:91)(cid:80)(cid:85)(cid:78)(cid:3) (cid:91)(cid:79)(cid:76)(cid:3) (cid:80)(cid:84)(cid:87)(cid:72)(cid:74)(cid:91)(cid:3) (cid:86)(cid:77)(cid:3) (cid:91)(cid:79)(cid:76)(cid:3) (cid:74)(cid:86)(cid:84)(cid:87)(cid:76)(cid:91)(cid:80)(cid:91)(cid:80)(cid:93)(cid:76)(cid:3) (cid:80)(cid:85)(cid:91)(cid:76)(cid:85)(cid:90)(cid:80)(cid:91)(cid:96)(cid:3) (cid:80)(cid:85)(cid:3) (cid:91)(cid:79)(cid:76)(cid:3)
wireless business including our response to that, as well as
the cost of integrating Digitel and Sun into the group.
Consolidated service revenues rose by 10% or Php15.3
billion to Php169.3 billion in 2012 with year-on-year
increases in revenues from our domestic voice, short
messaging services (SMS), data/broadband and BPO
services. International voice revenues, contributing 14%
to total service revenues, were lower by 2% at Php23.1
billion due to the combined effect of the peso appreciation,
lower international termination rates, and a decline in call
volumes with the increasing adoption of alternative modes
of communicating such as voice over internet protocol
(VoIP) calling.
Consolidated EBITDA dipped by 3%, or Php2.7 billion,
to Php77.3 billion at the end of 2012. EBITDA margin
(cid:89)(cid:76)(cid:75)(cid:92)(cid:74)(cid:76)(cid:75)(cid:3) (cid:91)(cid:86)(cid:3) (cid:27)(cid:29)(cid:12)(cid:3) (cid:77)(cid:89)(cid:86)(cid:84)(cid:3) (cid:28)(cid:25)(cid:12)(cid:3) (cid:80)(cid:85)(cid:3) (cid:25)(cid:23)(cid:24)(cid:24)(cid:3) (cid:89)(cid:76)(cid:197)(cid:3)(cid:76)(cid:74)(cid:91)(cid:80)(cid:85)(cid:78)(cid:3) (cid:91)(cid:79)(cid:76)(cid:3) (cid:80)(cid:84)(cid:87)(cid:72)(cid:74)(cid:91)(cid:3)
of the change in revenue mix from high-margin legacy
revenues such as international long distance (ILD) and
SMS, to relatively lower-margin broadband services. We
also booked expenses arising from a manpower rightsizing
program (MRP) amounting to Php3.8 billion during the year,
excluding which, EBITDA would have been Php1.1 billion
higher year-on-year and margin would have been 48%.
In February 2013, as part of the rationalization of our
portfolio, we announced our intention to sell our BPO
business to Asia Outsourcing Gamma Ltd. (AOGL), a
company controlled by the private equity fund, CVC Capital
Partners. This transaction was completed at the end
of April 2013. As such, for 2012, the BPO segment has
(cid:90)(cid:80)(cid:85)(cid:74)(cid:76)(cid:3)(cid:73)(cid:76)(cid:76)(cid:85)(cid:3)(cid:74)(cid:83)(cid:72)(cid:90)(cid:90)(cid:80)(cid:196)(cid:3)(cid:76)(cid:75)(cid:3)(cid:72)(cid:90)(cid:3)(cid:75)(cid:80)(cid:90)(cid:74)(cid:86)(cid:85)(cid:91)(cid:80)(cid:85)(cid:92)(cid:76)(cid:75)(cid:3)(cid:86)(cid:87)(cid:76)(cid:89)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:90)(cid:21)(cid:3)(cid:44)(cid:95)(cid:74)(cid:83)(cid:92)(cid:75)(cid:80)(cid:85)(cid:78)(cid:3)
discontinued operations, consolidated service revenues
stood at Php160.2 billion, and EBITDA at Php75.6 billion.
(cid:45)(cid:89)(cid:76)(cid:76)(cid:3)(cid:74)(cid:72)(cid:90)(cid:79)(cid:3)(cid:197)(cid:3)(cid:86)(cid:94)(cid:3)(cid:77)(cid:86)(cid:89)(cid:3)(cid:25)(cid:23)(cid:24)(cid:25)(cid:3)(cid:86)(cid:77)(cid:3)(cid:55)(cid:79)(cid:87)(cid:26)(cid:30)(cid:21)(cid:31)(cid:3)(cid:73)(cid:80)(cid:83)(cid:83)(cid:80)(cid:86)(cid:85)(cid:3)(cid:89)(cid:76)(cid:84)(cid:72)(cid:80)(cid:85)(cid:76)(cid:75)(cid:3)(cid:89)(cid:86)(cid:73)(cid:92)(cid:90)(cid:91)(cid:19)(cid:3)
although was lower than previous year, primarily due to
the higher capex for 2012 as we completed our two-year
network transformation program.
For the sixth consecutive year, PLDT declared 100% of
its 2012 core earnings as dividends. Total dividends per
share amounted to Php172 consisting of Php120 of regular
dividends and Php52 of special dividends representing 70%
and 30% of core earnings per share, respectively.
NETWORK TRANSFORMATION
With the completion of the two-year Php67.4 billion network
(cid:91)(cid:89)(cid:72)(cid:85)(cid:90)(cid:77)(cid:86)(cid:89)(cid:84)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3) (cid:87)(cid:89)(cid:86)(cid:78)(cid:89)(cid:72)(cid:84)(cid:3) (cid:80)(cid:85)(cid:3) (cid:25)(cid:23)(cid:24)(cid:25)(cid:19)(cid:3) (cid:91)(cid:79)(cid:76)(cid:3) (cid:55)(cid:51)(cid:43)(cid:59)(cid:3) (cid:46)(cid:89)(cid:86)(cid:92)(cid:87)(cid:3) (cid:77)(cid:86)(cid:89)(cid:91)(cid:80)(cid:196)(cid:3)(cid:76)(cid:75)(cid:3)
its market leadership and competitive advantage. Our
base stations are now 100% equipped with single radio
access network (RAN) facilities that are simpler, less costly
to operate and are easily upgradeable to fourth-generation
LTE technology. Our transmission network is far superior
(cid:91)(cid:86)(cid:3) (cid:74)(cid:86)(cid:84)(cid:87)(cid:76)(cid:91)(cid:80)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3) (cid:94)(cid:80)(cid:91)(cid:79)(cid:3) (cid:28)(cid:27)(cid:19)(cid:23)(cid:23)(cid:23)(cid:3) (cid:82)(cid:80)(cid:83)(cid:86)(cid:84)(cid:76)(cid:91)(cid:76)(cid:89)(cid:90)(cid:3) (cid:86)(cid:77)(cid:3) (cid:196)(cid:3)(cid:73)(cid:76)(cid:89)(cid:3) (cid:87)(cid:89)(cid:86)(cid:93)(cid:80)(cid:75)(cid:80)(cid:85)(cid:78)(cid:3)
high-bandwidth connections to our home and enterprise
customers and to our mobile base stations. To complement
(cid:86)(cid:92)(cid:89)(cid:3)(cid:75)(cid:86)(cid:84)(cid:76)(cid:90)(cid:91)(cid:80)(cid:74)(cid:3)(cid:196)(cid:3)(cid:73)(cid:76)(cid:89)(cid:3)(cid:85)(cid:76)(cid:91)(cid:94)(cid:86)(cid:89)(cid:82)(cid:19)(cid:3)(cid:94)(cid:76)(cid:3)(cid:72)(cid:83)(cid:90)(cid:86)(cid:3)(cid:79)(cid:72)(cid:93)(cid:76)(cid:3)(cid:89)(cid:86)(cid:73)(cid:92)(cid:90)(cid:91)(cid:3)(cid:80)(cid:85)(cid:91)(cid:76)(cid:89)(cid:85)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:72)(cid:83)(cid:3)
(cid:196)(cid:3)(cid:73)(cid:76)(cid:89)(cid:3)(cid:83)(cid:80)(cid:85)(cid:82)(cid:90)(cid:3)(cid:75)(cid:76)(cid:90)(cid:80)(cid:78)(cid:85)(cid:76)(cid:75)(cid:3)(cid:91)(cid:86)(cid:3)(cid:76)(cid:85)(cid:90)(cid:92)(cid:89)(cid:76)(cid:3)(cid:89)(cid:76)(cid:83)(cid:80)(cid:72)(cid:73)(cid:80)(cid:83)(cid:80)(cid:91)(cid:96)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:89)(cid:76)(cid:75)(cid:92)(cid:85)(cid:75)(cid:72)(cid:85)(cid:74)(cid:96)(cid:21)
As a result, the PLDT Group network remains unmatched in
its ability to provide high-quality voice, data and multimedia
services to our customers.
2012 ANNUAL REPORT
2012 ANNUAL REPORT
9
9
SUBSCRIBER BASE
At the end of 2012, PLDT’s total customer base grew to
over 75 million from 69 million at the end of 2011. The PLDT
Group has close to 70 million cellular subscribers, 3.3 million
(cid:73)(cid:89)(cid:86)(cid:72)(cid:75)(cid:73)(cid:72)(cid:85)(cid:75)(cid:3)(cid:90)(cid:92)(cid:73)(cid:90)(cid:74)(cid:89)(cid:80)(cid:73)(cid:76)(cid:89)(cid:90)(cid:19)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:25)(cid:21)(cid:24)(cid:3)(cid:84)(cid:80)(cid:83)(cid:83)(cid:80)(cid:86)(cid:85)(cid:3)(cid:196)(cid:95)(cid:76)(cid:75)(cid:3)(cid:83)(cid:80)(cid:85)(cid:76)(cid:3)(cid:90)(cid:92)(cid:73)(cid:90)(cid:74)(cid:89)(cid:80)(cid:73)(cid:76)(cid:89)(cid:90)(cid:19)(cid:3)
maintaining strong market leadership in all business segments.
BROADBAND
(cid:42)(cid:86)(cid:84)(cid:73)(cid:80)(cid:85)(cid:76)(cid:75)(cid:3) (cid:196)(cid:95)(cid:76)(cid:75)(cid:3) (cid:72)(cid:85)(cid:75)(cid:3) (cid:94)(cid:80)(cid:89)(cid:76)(cid:83)(cid:76)(cid:90)(cid:90)(cid:3) (cid:73)(cid:89)(cid:86)(cid:72)(cid:75)(cid:73)(cid:72)(cid:85)(cid:75)(cid:3) (cid:90)(cid:76)(cid:89)(cid:93)(cid:80)(cid:74)(cid:76)(cid:3) (cid:89)(cid:76)(cid:93)(cid:76)(cid:85)(cid:92)(cid:76)(cid:90)(cid:3)
improved by 26% year-on-year to Php23.7 billion in 2012,
now accounting for 13% of total group service revenues.
In addition to Php3.2 billion contributed by Digitel/Sun,
PLDT DSL revenues were higher by 12% at Php10.6 billion
(cid:77)(cid:86)(cid:83)(cid:83)(cid:86)(cid:94)(cid:80)(cid:85)(cid:78)(cid:3)(cid:72)(cid:3)(cid:28)(cid:12)(cid:3)(cid:80)(cid:85)(cid:74)(cid:89)(cid:76)(cid:72)(cid:90)(cid:76)(cid:3)(cid:80)(cid:85)(cid:3)(cid:90)(cid:92)(cid:73)(cid:90)(cid:74)(cid:89)(cid:80)(cid:73)(cid:76)(cid:89)(cid:90)(cid:34)(cid:3)(cid:94)(cid:80)(cid:89)(cid:76)(cid:83)(cid:76)(cid:90)(cid:90)(cid:3)(cid:73)(cid:89)(cid:86)(cid:72)(cid:75)(cid:73)(cid:72)(cid:85)(cid:75)(cid:3)
revenues were up by 4% to Php6.7 billion with a 7% rise in
(cid:90)(cid:92)(cid:73)(cid:90)(cid:74)(cid:89)(cid:80)(cid:73)(cid:76)(cid:89)(cid:90)(cid:34)(cid:3)(cid:94)(cid:79)(cid:80)(cid:83)(cid:76)(cid:3)(cid:84)(cid:86)(cid:73)(cid:80)(cid:83)(cid:76)(cid:3)(cid:80)(cid:85)(cid:91)(cid:76)(cid:89)(cid:85)(cid:76)(cid:91)(cid:3)(cid:89)(cid:76)(cid:93)(cid:76)(cid:85)(cid:92)(cid:76)(cid:90)(cid:3)(cid:74)(cid:83)(cid:80)(cid:84)(cid:73)(cid:76)(cid:75)(cid:3)(cid:73)(cid:96)(cid:3)(cid:28)(cid:29)(cid:12)(cid:3)
(cid:91)(cid:86)(cid:3)(cid:55)(cid:79)(cid:87)(cid:25)(cid:21)(cid:29)(cid:3)(cid:73)(cid:80)(cid:83)(cid:83)(cid:80)(cid:86)(cid:85)(cid:3)(cid:89)(cid:76)(cid:197)(cid:76)(cid:74)(cid:91)(cid:80)(cid:85)(cid:78)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:78)(cid:89)(cid:86)(cid:94)(cid:80)(cid:85)(cid:78)(cid:3)(cid:92)(cid:90)(cid:76)(cid:3)(cid:86)(cid:77)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:90)(cid:76)(cid:89)(cid:93)(cid:80)(cid:74)(cid:76)(cid:21)
Broadband remains the bright spot for the business as usage
continues to grow strongly given a young, literate Philippine
population with increasing purchasing power. Although
most of usage today is by shared access or at internet
cafes, we anticipate that this will shift to mobile and to
homes as the cost of access devices such as smartphones,
smart TVs, laptops and the like becomes more affordable
by a broader market. PLDT’s investments in the network
have given it not only an early lead, but a distinct competitive
network advantage over competition in the group’s ability to
consistently provide our customers with quality of experience
(cid:86)(cid:85)(cid:3)(cid:72)(cid:3)(cid:94)(cid:80)(cid:75)(cid:76)(cid:3)(cid:89)(cid:72)(cid:85)(cid:78)(cid:76)(cid:3)(cid:86)(cid:77)(cid:3)(cid:196)(cid:95)(cid:76)(cid:75)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:84)(cid:86)(cid:73)(cid:80)(cid:83)(cid:76)(cid:3)(cid:75)(cid:76)(cid:93)(cid:80)(cid:74)(cid:76)(cid:90)(cid:21)
The PLDT group is well positioned to offer and deliver a
suite of broadband services with varied speeds and price
points, over multiple platforms to both retail and corporate
customers. These products include FTTH, as well as
bundled products such as WiFi service outside the home for
DSL subscribers, direct-to-home (DTH)/content packages
(cid:80)(cid:85)(cid:3)(cid:72)(cid:75)(cid:75)(cid:80)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:91)(cid:86)(cid:3)(cid:86)(cid:92)(cid:89)(cid:3)(cid:196)(cid:95)(cid:76)(cid:75)(cid:3)(cid:83)(cid:80)(cid:85)(cid:76)(cid:3)(cid:90)(cid:76)(cid:89)(cid:93)(cid:80)(cid:74)(cid:76)(cid:21)
WIRELESS BUSINESS
Revenues from our wireless business registered a 15%
year-on-year increase to Php117.4 billion in 2012, mainly
due to the contribution of Php20.9 billion from Sun
Cellular. Competitive pressures impacted the wireless
business which saw SMS revenues dip despite increase in
the number of messages sent, and lower voice revenues
arising from lower voice minutes registered. These revenue
declines were partly offset by higher revenues from wireless
broadband and mobile internet browsing.
Wireless EBITDA of Php54.4 billion was a 2% reduction
(cid:93)(cid:76)(cid:89)(cid:90)(cid:92)(cid:90)(cid:3) (cid:91)(cid:79)(cid:76)(cid:3) (cid:87)(cid:89)(cid:80)(cid:86)(cid:89)(cid:3) (cid:96)(cid:76)(cid:72)(cid:89)(cid:3) (cid:89)(cid:76)(cid:197)(cid:76)(cid:74)(cid:91)(cid:80)(cid:85)(cid:78)(cid:3) (cid:91)(cid:79)(cid:76)(cid:3) (cid:74)(cid:86)(cid:84)(cid:73)(cid:80)(cid:85)(cid:76)(cid:75)(cid:3) (cid:80)(cid:84)(cid:87)(cid:72)(cid:74)(cid:91)(cid:3) (cid:86)(cid:77)(cid:3)
lower revenues and increases in subsidies and expenses
arising from the MRP undertaken during the year as part of
the inclusion of Sun Cellular into the group. EBITDA margin
declined to 46%, in part due to the lower margin of Digitel,
and the MRP expenses.
(cid:62)(cid:76)(cid:3)(cid:72)(cid:89)(cid:76)(cid:3)(cid:73)(cid:76)(cid:78)(cid:80)(cid:85)(cid:85)(cid:80)(cid:85)(cid:78)(cid:3)(cid:91)(cid:86)(cid:3)(cid:90)(cid:76)(cid:76)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:73)(cid:76)(cid:85)(cid:76)(cid:196)(cid:91)(cid:90)(cid:3)(cid:77)(cid:89)(cid:86)(cid:84)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:72)(cid:74)(cid:88)(cid:92)(cid:80)(cid:90)(cid:80)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:86)(cid:77)(cid:3)
Digitel Group as part of our efforts to bring growth back to
the business. We successfully defended our revenue market
share in the wireless business which held steady throughout
2012. In addition to this, we undertook various initiatives
that aimed to grow revenues such as higher-denomination,
longer-duration offers, a greater push to grow our postpaid
business, and efforts to clearly differentiate and leverage the
strong brand equities of Smart, Talk ‘N Text and Sun Cellular.
FIXED LINE
Fixed line service revenues for 2012 rose by 4% from the
end of 2011 to Php61.3 billion as increases in revenues from
DSL and corporate data and other network services offset
declines in international and national long distance revenues.
Fixed line EBITDA dipped by 10% to Php20.3 billion in 2012
following higher cash expenses which included a Php3.0
billion charge in connection with the MRP implemented
during the year. EBITDA margin was lower at 33%. Excluding
the impact of the MRP expenses, EBITDA would have been
higher year-on-year by Php0.6 billion and EBITDA margin
would have been 38% compared with 39% in 2011.
(cid:46)(cid:89)(cid:86)(cid:94)(cid:91)(cid:79)(cid:3) (cid:84)(cid:86)(cid:84)(cid:76)(cid:85)(cid:91)(cid:92)(cid:84)(cid:3) (cid:80)(cid:85)(cid:3) (cid:196)(cid:95)(cid:76)(cid:75)(cid:3) (cid:83)(cid:80)(cid:85)(cid:76)(cid:3) (cid:90)(cid:76)(cid:89)(cid:93)(cid:80)(cid:74)(cid:76)(cid:3) (cid:89)(cid:76)(cid:93)(cid:76)(cid:85)(cid:92)(cid:76)(cid:90)(cid:3) (cid:94)(cid:80)(cid:83)(cid:83)(cid:3) (cid:73)(cid:76)(cid:3)
further fuelled by initiatives that are focused on the Home
market, including FTTH, connected screens, triple-play
(cid:86)(cid:77)(cid:77)(cid:76)(cid:89)(cid:90)(cid:3) (cid:94)(cid:80)(cid:91)(cid:79)(cid:3) (cid:74)(cid:86)(cid:85)(cid:91)(cid:76)(cid:85)(cid:91)(cid:3) (cid:75)(cid:76)(cid:83)(cid:80)(cid:93)(cid:76)(cid:89)(cid:76)(cid:75)(cid:3) (cid:86)(cid:93)(cid:76)(cid:89)(cid:3) (cid:196)(cid:73)(cid:76)(cid:89)(cid:34)(cid:3) (cid:3) (cid:72)(cid:90)(cid:3) (cid:94)(cid:76)(cid:83)(cid:83)(cid:3) (cid:72)(cid:90)(cid:3) (cid:91)(cid:79)(cid:76)(cid:3)
Enterprise market through various business solutions
customized for large corporates, BPOs, small-and-medium
enterprises (SMEs) and micro businesses. All these are
(cid:76)(cid:85)(cid:72)(cid:73)(cid:83)(cid:76)(cid:75)(cid:3)(cid:73)(cid:96)(cid:3)(cid:55)(cid:51)(cid:43)(cid:59)(cid:187)(cid:90)(cid:3)(cid:90)(cid:80)(cid:78)(cid:85)(cid:80)(cid:196)(cid:74)(cid:72)(cid:85)(cid:91)(cid:3)(cid:74)(cid:72)(cid:87)(cid:76)(cid:95)(cid:3)(cid:80)(cid:85)(cid:93)(cid:76)(cid:90)(cid:91)(cid:84)(cid:76)(cid:85)(cid:91)(cid:90)(cid:3)(cid:91)(cid:79)(cid:72)(cid:91)(cid:3)(cid:80)(cid:85)(cid:74)(cid:83)(cid:92)(cid:75)(cid:76)(cid:3)
(cid:92)(cid:87)(cid:78)(cid:89)(cid:72)(cid:75)(cid:76)(cid:90)(cid:3)(cid:86)(cid:77)(cid:3) (cid:86)(cid:92)(cid:89)(cid:3) (cid:196)(cid:95)(cid:76)(cid:75)(cid:3) (cid:83)(cid:80)(cid:85)(cid:76)(cid:3) (cid:91)(cid:86)(cid:3) (cid:196)(cid:73)(cid:76)(cid:89)(cid:3) (cid:72)(cid:85)(cid:75)(cid:3) (cid:91)(cid:86)(cid:3) (cid:85)(cid:76)(cid:95)(cid:91)(cid:3) (cid:78)(cid:76)(cid:85)(cid:76)(cid:89)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)
network (NGN).
BPO
The strengthening of the peso during the year impacted
the whole BPO industry whose revenues are largely dollar-
denominated. Nevertheless, service revenues from our BPO
business registered a 15% year-on-year increase to Php9.9
(cid:73)(cid:80)(cid:83)(cid:83)(cid:80)(cid:86)(cid:85)(cid:3)(cid:80)(cid:85)(cid:3)(cid:25)(cid:23)(cid:24)(cid:25)(cid:3)(cid:89)(cid:76)(cid:197)(cid:76)(cid:74)(cid:91)(cid:80)(cid:85)(cid:78)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:74)(cid:86)(cid:85)(cid:91)(cid:80)(cid:85)(cid:92)(cid:76)(cid:75)(cid:3)(cid:73)(cid:76)(cid:85)(cid:76)(cid:196)(cid:91)(cid:90)(cid:3)(cid:77)(cid:89)(cid:86)(cid:84)(cid:3)(cid:73)(cid:92)(cid:80)(cid:83)(cid:75)(cid:80)(cid:85)(cid:78)(cid:3)
up the sales and marketing organization for the business
and the full year impact of the acquisition of a high-margin
business in education publishing.
BPO EBITDA grew by 33% to Php2.1 billion and EBITDA
margin improved to 21% from 18% in 2011 as a result of
initiatives that focused on increasing revenues and improving
(cid:76)(cid:77)(cid:196)(cid:74)(cid:80)(cid:76)(cid:85)(cid:74)(cid:80)(cid:76)(cid:90)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:87)(cid:89)(cid:86)(cid:196)(cid:91)(cid:72)(cid:73)(cid:80)(cid:83)(cid:80)(cid:91)(cid:96)(cid:21)(cid:3)
Following the sale of the BPO business and the subsequent
(cid:80)(cid:85)(cid:93)(cid:76)(cid:90)(cid:91)(cid:84)(cid:76)(cid:85)(cid:91)(cid:3)(cid:80)(cid:85)(cid:3)(cid:25)(cid:23)(cid:12)(cid:3)(cid:86)(cid:77)(cid:3)(cid:40)(cid:54)(cid:46)(cid:51)(cid:19)(cid:3)(cid:55)(cid:51)(cid:43)(cid:59)(cid:3)(cid:94)(cid:80)(cid:83)(cid:83)(cid:3)(cid:85)(cid:86)(cid:3)(cid:83)(cid:86)(cid:85)(cid:78)(cid:76)(cid:89)(cid:3)(cid:89)(cid:76)(cid:197)(cid:76)(cid:74)(cid:91)(cid:3)(cid:41)(cid:55)(cid:54)(cid:3)
(cid:72)(cid:90)(cid:3)(cid:72)(cid:3)(cid:90)(cid:76)(cid:87)(cid:72)(cid:89)(cid:72)(cid:91)(cid:76)(cid:3)(cid:90)(cid:76)(cid:78)(cid:84)(cid:76)(cid:85)(cid:91)(cid:3)(cid:80)(cid:85)(cid:3)(cid:80)(cid:91)(cid:90)(cid:3)(cid:25)(cid:23)(cid:24)(cid:26)(cid:3)(cid:196)(cid:85)(cid:72)(cid:85)(cid:74)(cid:80)(cid:72)(cid:83)(cid:90)(cid:19)(cid:3)(cid:73)(cid:92)(cid:91)(cid:3)(cid:94)(cid:80)(cid:83)(cid:83)(cid:3)(cid:80)(cid:85)(cid:90)(cid:91)(cid:76)(cid:72)(cid:75)(cid:3)
equity account the earnings from its BPO investment.
10
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY
EVOLVING INTO A MULTIMEDIA ORGANIZATION
PLDT’s strategic direction is to transform itself into a
telecommunications
multimedia organization as
industry evolves within a more complex, digital, multimedia
environment. Other telcos worldwide have begun to move
in a similar direction.
the
Meralco registered another banner year in 2012 with a 9%
year-on-year rise in core income to Php16.3 billion arising
from increases in electricity sales volumes, an expanded
(cid:74)(cid:92)(cid:90)(cid:91)(cid:86)(cid:84)(cid:76)(cid:89)(cid:3) (cid:73)(cid:72)(cid:90)(cid:76)(cid:19)(cid:3) (cid:72)(cid:85)(cid:75)(cid:3)
(cid:80)(cid:84)(cid:87)(cid:89)(cid:86)(cid:93)(cid:76)(cid:75)(cid:3) (cid:86)(cid:87)(cid:76)(cid:89)(cid:72)(cid:91)(cid:80)(cid:85)(cid:78)(cid:3) (cid:76)(cid:77)(cid:196)(cid:74)(cid:80)(cid:76)(cid:85)(cid:74)(cid:80)(cid:76)(cid:90)(cid:21)
Approximately 70% of 2012 core earnings, equivalent to
Php10.10 per share, were paid out as dividends.
Historically, MediaQuest Holdings, Inc. (MediaQuest), a
(cid:94)(cid:79)(cid:86)(cid:83)(cid:83)(cid:96)(cid:20)(cid:86)(cid:94)(cid:85)(cid:76)(cid:75)(cid:3)(cid:76)(cid:85)(cid:91)(cid:80)(cid:91)(cid:96)(cid:3)(cid:86)(cid:77)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:55)(cid:51)(cid:43)(cid:59)(cid:3)(cid:41)(cid:76)(cid:85)(cid:76)(cid:196)(cid:74)(cid:80)(cid:72)(cid:83)(cid:3)(cid:59)(cid:89)(cid:92)(cid:90)(cid:91)(cid:3)(cid:45)(cid:92)(cid:85)(cid:75)(cid:19)(cid:3)(cid:79)(cid:72)(cid:90)(cid:3)
made investments using internal funds principally into TV5
(cid:72)(cid:85)(cid:75)(cid:3) (cid:42)(cid:80)(cid:78)(cid:85)(cid:72)(cid:83)(cid:59)(cid:61)(cid:21)(cid:3) (cid:58)(cid:80)(cid:85)(cid:74)(cid:76)(cid:3) (cid:90)(cid:91)(cid:72)(cid:89)(cid:91)(cid:3) (cid:86)(cid:77)(cid:3) (cid:91)(cid:79)(cid:76)(cid:80)(cid:89)(cid:3) (cid:86)(cid:87)(cid:76)(cid:89)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:90)(cid:19)(cid:3) (cid:90)(cid:80)(cid:78)(cid:85)(cid:80)(cid:196)(cid:74)(cid:72)(cid:85)(cid:91)(cid:3)
improvements in audience market share and subscriber
base have been achieved by TV5 and CignalTV, respectively.
In 2012, PLDT announced its intention to invest Php6 billion
in MediaQuest PDRs for an effective 40% economic interest
in Mediascape, Inc. (Mediascape), which operates a DTH
Pay-TV business under the brand name “CignalTV.” PLDT
also recently announced its intention to make an additional
investment of Php3.6 billion in the CignalTV business, that
will increase its effective economic interest to 64%.
PLDT is very optimistic about the potentials of the pay
TV industry in the Philippines, and CignalTV’s competitive
advantages that can give it a strong position in the market.
Pay TV penetration is low as the industry is fragmented,
and is still in transition from analog to digital. The market
leader operates a cable business with its reach largely
limited to Metro Manila. Being a DTH service, CignalTV
can expand its nationwide footprint faster. Its access to the
PLDT Group’s prepaid platform and distribution network
allows it to easily offer prepaid pay TV services. Unlike the
competition, CignalTV is already fully digital, and offers the
(cid:84)(cid:86)(cid:90)(cid:91)(cid:3)(cid:85)(cid:92)(cid:84)(cid:73)(cid:76)(cid:89)(cid:3)(cid:86)(cid:77)(cid:3)(cid:79)(cid:80)(cid:78)(cid:79)(cid:20)(cid:75)(cid:76)(cid:196)(cid:85)(cid:80)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:74)(cid:79)(cid:72)(cid:85)(cid:85)(cid:76)(cid:83)(cid:90)(cid:3)(cid:80)(cid:85)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:55)(cid:79)(cid:80)(cid:83)(cid:80)(cid:87)(cid:87)(cid:80)(cid:85)(cid:76)(cid:90)(cid:21)(cid:3)
In 2012, CignalTV had over 441,000 subscribers.
We are now working on making CignalTV’s content available
to customers of our FTTH offer, Fibr. Moving forward, we are
very excited by the unparalleled opportunities for the PLDT
Group to offer combinations of voice, high-speed internet,
and content over multi-screens including the mobile phone,
TV, tablets and laptops.
In line with its efforts to acquire access to news content,
PLDT also announced its intention to invest Php1.95 billion in
MediaQuest PDRs for economic interest in Hasting Holdings,
Inc., which holds print-related investments including minority
positions in the three leading broadsheets: The Philippine
(cid:58)(cid:91)(cid:72)(cid:89)(cid:19)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:55)(cid:79)(cid:80)(cid:83)(cid:80)(cid:87)(cid:87)(cid:80)(cid:85)(cid:76)(cid:3)(cid:43)(cid:72)(cid:80)(cid:83)(cid:96)(cid:3)(cid:48)(cid:85)(cid:88)(cid:92)(cid:80)(cid:89)(cid:76)(cid:89)(cid:19)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:41)(cid:92)(cid:90)(cid:80)(cid:85)(cid:76)(cid:90)(cid:90)(cid:62)(cid:86)(cid:89)(cid:83)(cid:75)(cid:21)
MERALCO
The PLDT Group continues to own a strategic stake in
Meralco through PLDT Communications and Energy Ventures,
Inc. (PCEV, formerly Piltel), which together with MPIC
co-owns Beacon Electric Asset Holdings, Inc. Beacon
remains the largest shareholder of Meralco with a 48%
equity interest.
The value of PLDT’s investment in Meralco continues to
grow. The outlook for Meralco is enhanced by its entry into
power generation, complementing the anticipated continued
growth in its main distribution utility business. In March 2013,
Meralco announced an investment in GMR Energy (Singapore)
(cid:55)(cid:91)(cid:76)(cid:21)(cid:3) (cid:51)(cid:91)(cid:75)(cid:21)(cid:3) (cid:72)(cid:3) (cid:25)(cid:95)(cid:27)(cid:23)(cid:23)(cid:3) (cid:52)(cid:62)(cid:3) (cid:51)(cid:80)(cid:88)(cid:92)(cid:80)(cid:196)(cid:76)(cid:75)(cid:3) (cid:53)(cid:72)(cid:91)(cid:92)(cid:89)(cid:72)(cid:83)(cid:3) (cid:46)(cid:72)(cid:90)(cid:3) (LNG)(cid:20)(cid:196)(cid:89)(cid:76)(cid:75)(cid:3)
combined cycle facility in Singapore, where Meralco has an
effective 28% equity interest. This is one of the pipeline of
investments in power generation lined up by Meralco.
DEBT POSITION
Despite a modest increase in debt levels, PLDT’s consolidated
(cid:196)(cid:85)(cid:72)(cid:85)(cid:74)(cid:80)(cid:72)(cid:83)(cid:3) (cid:87)(cid:86)(cid:90)(cid:80)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3) (cid:89)(cid:76)(cid:84)(cid:72)(cid:80)(cid:85)(cid:76)(cid:75)(cid:3) (cid:89)(cid:86)(cid:73)(cid:92)(cid:90)(cid:91)(cid:3) (cid:80)(cid:85)(cid:3) (cid:25)(cid:23)(cid:24)(cid:25)(cid:21)(cid:3) (cid:42)(cid:86)(cid:85)(cid:90)(cid:86)(cid:83)(cid:80)(cid:75)(cid:72)(cid:91)(cid:76)(cid:75)(cid:3)
gross debt increased to US$2.9 billion with the inclusion of
US$0.5 billion of debt from Digitel, while net debt rose to
US$1.9 billion. Net debt to EBITDA stood at 1.05x, within
optimum gearing levels. PLDT’s US$145 million 2012
bond matured in May 2012. The remaining debt maturities
continue to be well spread out.
(cid:48)(cid:85)(cid:3)(cid:25)(cid:23)(cid:24)(cid:25)(cid:19)(cid:3)(cid:55)(cid:51)(cid:43)(cid:59)(cid:3)(cid:73)(cid:76)(cid:74)(cid:72)(cid:84)(cid:76)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:196)(cid:89)(cid:90)(cid:91)(cid:3)(cid:55)(cid:79)(cid:80)(cid:83)(cid:80)(cid:87)(cid:87)(cid:80)(cid:85)(cid:76)(cid:3)(cid:74)(cid:86)(cid:89)(cid:87)(cid:86)(cid:89)(cid:72)(cid:91)(cid:76)(cid:3)(cid:72)(cid:74)(cid:74)(cid:86)(cid:89)(cid:75)(cid:76)(cid:75)(cid:3)
investment grade status with the upgrade of its foreign and
local credit ratings by Fitch Ratings, Moody’s, and Standard
and Poor’s.
2013: RETURN TO GROWTH
The huge investment we made in Digitel in 2011 required us
to focus on alignment and adjustment in 2012. At the same
time, we completed our network transformation program
which also involved hefty infrastructure investments. Not
surprisingly, these moves had a dampening effect on our
(cid:196)(cid:85)(cid:72)(cid:85)(cid:74)(cid:80)(cid:72)(cid:83)(cid:3)(cid:87)(cid:76)(cid:89)(cid:77)(cid:86)(cid:89)(cid:84)(cid:72)(cid:85)(cid:74)(cid:76)(cid:3)(cid:80)(cid:85)(cid:3)(cid:25)(cid:23)(cid:24)(cid:25)(cid:21)(cid:3)(cid:3)
(cid:52)(cid:86)(cid:93)(cid:80)(cid:85)(cid:78)(cid:3)(cid:77)(cid:86)(cid:89)(cid:94)(cid:72)(cid:89)(cid:75)(cid:19)(cid:3)(cid:86)(cid:92)(cid:89)(cid:3)(cid:84)(cid:72)(cid:85)(cid:75)(cid:72)(cid:91)(cid:76)(cid:3)(cid:80)(cid:90)(cid:3)(cid:74)(cid:83)(cid:76)(cid:72)(cid:89)(cid:21)(cid:3)(cid:62)(cid:76)(cid:3)(cid:72)(cid:89)(cid:76)(cid:3)(cid:74)(cid:86)(cid:85)(cid:196)(cid:75)(cid:76)(cid:85)(cid:91)(cid:3)(cid:91)(cid:79)(cid:72)(cid:91)(cid:3)
we have steered PLDT back into the growth path and will
(cid:90)(cid:76)(cid:76)(cid:3)(cid:72)(cid:3)(cid:90)(cid:91)(cid:76)(cid:72)(cid:75)(cid:96)(cid:3)(cid:89)(cid:80)(cid:90)(cid:76)(cid:3)(cid:80)(cid:85)(cid:3)(cid:87)(cid:89)(cid:86)(cid:196)(cid:91)(cid:72)(cid:73)(cid:80)(cid:83)(cid:80)(cid:91)(cid:96)(cid:21)
We are fully aware that PLDT is pursuing growth within a very
dynamic industry environment. As the world of telecoms,
the internet and media come together, we are constantly
monitoring and evaluating how these changes may impact
our business. Our strategy is to embrace change and to get
ahead of the curve. The repositioning of our portfolio and
our greater involvement in the media/content business is
part of a far-reaching transformation that aims to strengthen
PLDT’s leadership in the emerging digital world.
On behalf of your Management Team, let me assure you of
our collective commitment to build a new future for PLDT.
NAPOLEON L. NAZARENO
(cid:55)(cid:89)(cid:76)(cid:90)(cid:80)(cid:75)(cid:76)(cid:85)(cid:91)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:42)(cid:79)(cid:80)(cid:76)(cid:77)(cid:3)(cid:44)(cid:95)(cid:76)(cid:74)(cid:92)(cid:91)(cid:80)(cid:93)(cid:76)(cid:3)(cid:54)(cid:77)(cid:196)(cid:74)(cid:76)(cid:89)
2012 ANNUAL REPORT
11
FIBER TO THE HOME
PLDT PROVIDES THE STRONGEST CONNECTIONS TO FAMILIES IN THE DIGITAL AGE.
AT HOME, POPULAR GADGETS LIKE THE SMARTPHONE, INTERNET TV AND TELPAD CAN
BE USED IN SYNC BY FAMILY MEMBERS WITH THE HELP OF A POWERFUL INTERNET
CONNECTION THAT RUNS ON FIBER OPTICS TECHNOLOGY.
12
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY
PLDT GROUP
CORPORATE MILESTONES
PLDT MADE MAJOR STRIDES IN 2012 IN DELIVERING ENHANCED BROADBAND DATA
SERVICES TO ITS CUSTOMERS AS IT PURSUED MAJOR INITIATIVES TO TRANSFORM
ITSELF INTO AN INTEGRATED MULTIMEDIA COMMUNICATIONS GROUP.
ALL ABOUT FIBER
Working double-time, PLDT and its wireless subsidiary
Smart completed ahead of schedule the Group’s
two-year Php67.4 billion (US$1.6 billion) network
transformation program – an initiative designed to boost
service quality and reliability and more than triple voice
and data capacity of the network.
Two aspects of this program stood out: First, the expansion
(cid:72)(cid:85)(cid:75)(cid:3)(cid:77)(cid:86)(cid:89)(cid:91)(cid:80)(cid:196)(cid:74)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:86)(cid:77)(cid:3)(cid:55)(cid:51)(cid:43)(cid:59)(cid:187)(cid:90)(cid:3)(cid:75)(cid:86)(cid:84)(cid:76)(cid:90)(cid:91)(cid:80)(cid:74)(cid:3)(cid:196)(cid:73)(cid:76)(cid:89)(cid:3)(cid:86)(cid:87)(cid:91)(cid:80)(cid:74)(cid:3)(cid:74)(cid:72)(cid:73)(cid:83)(cid:76)(cid:3)(cid:85)(cid:76)(cid:91)(cid:94)(cid:86)(cid:89)(cid:82)(cid:21)(cid:3)
Second, the transformation of Smart’s mobile network into
one ready for the deployment of LTE, the fourth generation of
mobile data technologies.
Complementing the expansion of its domestic infrastructure,
PLDT also strengthened its international data linkages. In 2012,
PLDT launched the Asia Submarine Cable Express (ASE), the
only active underwater cable system in the country’s east coast.
(cid:62)(cid:80)(cid:91)(cid:79)(cid:3)(cid:30)(cid:19)(cid:25)(cid:23)(cid:23)(cid:3)(cid:82)(cid:80)(cid:83)(cid:86)(cid:84)(cid:76)(cid:91)(cid:76)(cid:89)(cid:90)(cid:3)(cid:86)(cid:77)(cid:3)(cid:196)(cid:73)(cid:76)(cid:89)(cid:3)(cid:86)(cid:87)(cid:91)(cid:80)(cid:74)(cid:3)(cid:74)(cid:72)(cid:73)(cid:83)(cid:76)(cid:19)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:40)(cid:58)(cid:44)(cid:3)(cid:3)(cid:83)(cid:80)(cid:85)(cid:82)(cid:90)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)
Philippines with Japan, Hong Kong, Singapore and Malaysia,
while interconnecting with other major cable systems onward to
the United States, Europe and the Middle East.
Of the current six international submarine cable systems
in the country, the ASE is the largest in capacity, utilizing
40Gbps technology which can be further enhanced to
100Gbps. The ASE that lands in Camarines Norte is the
(cid:196)(cid:89)(cid:90)(cid:91)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:86)(cid:85)(cid:83)(cid:96)(cid:3)(cid:92)(cid:85)(cid:75)(cid:76)(cid:89)(cid:94)(cid:72)(cid:91)(cid:76)(cid:89)(cid:3)(cid:74)(cid:72)(cid:73)(cid:83)(cid:76)(cid:3)(cid:90)(cid:96)(cid:90)(cid:91)(cid:76)(cid:84)(cid:3)(cid:91)(cid:79)(cid:72)(cid:91)(cid:3)(cid:73)(cid:96)(cid:87)(cid:72)(cid:90)(cid:90)(cid:76)(cid:90)(cid:3)
the earthquake-prone Taiwan corridor, enabling PLDT to
(cid:91)(cid:89)(cid:72)(cid:85)(cid:90)(cid:87)(cid:86)(cid:89)(cid:91)(cid:3)(cid:91)(cid:89)(cid:72)(cid:77)(cid:196)(cid:74)(cid:3)(cid:75)(cid:80)(cid:89)(cid:76)(cid:74)(cid:91)(cid:83)(cid:96)(cid:3)(cid:91)(cid:86)(cid:3)(cid:49)(cid:72)(cid:87)(cid:72)(cid:85)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:91)(cid:79)(cid:76)(cid:85)(cid:3)(cid:86)(cid:85)(cid:94)(cid:72)(cid:89)(cid:75)(cid:90)(cid:3)(cid:91)(cid:86)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)
United States with the shortest latency and least points
of failure. It also complements PLDT’s three other landing
stations in Batangas, Cavite and La Union.
2012 ANNUAL REPORT
13
INNOVATIVE PRODUCTS AND SERVICES
Its network transformation enabled the PLDT Group to improve its basic services
and offer advanced broadband services to better address the needs of its clients
– be they in a residential, commercial, or enterprise setting – whether they are
residents or Filipinos working overseas.
(cid:48)(cid:85)(cid:3)(cid:84)(cid:80)(cid:75)(cid:20)(cid:25)(cid:23)(cid:24)(cid:25)(cid:19)(cid:3)(cid:55)(cid:51)(cid:43)(cid:59)(cid:3)(cid:83)(cid:72)(cid:92)(cid:85)(cid:74)(cid:79)(cid:76)(cid:75)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:74)(cid:86)(cid:92)(cid:85)(cid:91)(cid:89)(cid:96)(cid:187)(cid:90)(cid:3)(cid:196)(cid:89)(cid:90)(cid:91)(cid:3)
(cid:45)(cid:59)(cid:59)(cid:47)(cid:3)(cid:73)(cid:89)(cid:86)(cid:72)(cid:75)(cid:73)(cid:72)(cid:85)(cid:75)(cid:3)(cid:90)(cid:76)(cid:89)(cid:93)(cid:80)(cid:74)(cid:76)(cid:3)(cid:86)(cid:85)(cid:3)(cid:80)(cid:91)(cid:90)(cid:3)(cid:196)(cid:95)(cid:76)(cid:75)(cid:3)(cid:85)(cid:76)(cid:91)(cid:94)(cid:86)(cid:89)(cid:82)(cid:21)(cid:3)(cid:62)(cid:80)(cid:91)(cid:79)(cid:3)
speeds of up to 100 Mbps, the service allows
family members to enjoy seamless, simultaneous
(cid:79)(cid:80)(cid:78)(cid:79)(cid:20)(cid:75)(cid:76)(cid:196)(cid:85)(cid:80)(cid:91)(cid:80)(cid:86)(cid:85)(cid:19)(cid:3)(cid:26)(cid:43)(cid:19)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:80)(cid:85)(cid:91)(cid:76)(cid:89)(cid:72)(cid:74)(cid:91)(cid:80)(cid:93)(cid:76)(cid:3)(cid:93)(cid:80)(cid:75)(cid:76)(cid:86)(cid:3)(cid:90)(cid:91)(cid:89)(cid:76)(cid:72)(cid:84)(cid:80)(cid:85)(cid:78)(cid:19)(cid:3)
simultaneous and high-speed web browsing.
The Company relaunched the TELPAD, tripling
the number of subscribers using the device
from a year ago. TELPAD strategically provides
a platform for offering a growing number of
value-added services at home.
In another pioneering move, Smart introduced
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in Metro Manila and gradually to more and more
areas nationwide. By April 1, 2013, Smart’s
LTE coverage had reached 46 cities and 40
municipalities. In early 2012, Smart introduced
LTE Plug-It and Pocket WiFi devices to give
subscribers an initial experience of the much faster
data speeds available on LTE. Late in the year, it
brought in several LTE handsets including those
from Apple, Sony and Huawei.
14
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY
PLDT brought into the market PLDT Cloud, a suite
of solutions that makes use of PLDT’s new public
cloud infrastructure to provide companies with all
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(cid:90)(cid:76)(cid:74)(cid:92)(cid:89)(cid:80)(cid:91)(cid:96)(cid:19)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:74)(cid:86)(cid:90)(cid:91)(cid:20)(cid:76)(cid:77)(cid:196)(cid:3)(cid:74)(cid:80)(cid:76)(cid:85)(cid:74)(cid:96)(cid:21)
(cid:58)(cid:84)(cid:72)(cid:89)(cid:91)(cid:3)(cid:72)(cid:83)(cid:90)(cid:86)(cid:3)(cid:80)(cid:85)(cid:91)(cid:89)(cid:86)(cid:75)(cid:92)(cid:74)(cid:76)(cid:75)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:74)(cid:86)(cid:92)(cid:85)(cid:91)(cid:89)(cid:96)(cid:187)(cid:90)(cid:3)(cid:196)(cid:3)(cid:89)(cid:90)(cid:91)(cid:3)(cid:47)(cid:80)(cid:78)(cid:79)(cid:3)(cid:43)(cid:76)(cid:196)(cid:3)(cid:85)(cid:80)(cid:91)(cid:80)(cid:86)(cid:85) (HD) Voice service.
Similar to hearing the difference between AM and FM radio stations, HD
Voice makes it easier for callers to recognize commonly misheard sounds.
HD Voice is initially available in select areas in Makati City and Bonifacio
Global City in Taguig City and can be enjoyed on smartphones running on
3G which are capable of Adaptive Multi-Rate Wideband (AMR-WB).
PLDT launched SIP Trunks service or session initiation
protocol trunk line solution to serve the growing use of
IP-PBX or IP-based corporate phone systems in the
enterprise market. PLDT SIP Trunk runs over PLDT’s
robust next generation IP network offering quality of
service to corporation’s expanding and complex voice
applications.
PLDT SME Nation launched the Productivity Solutions
Suite—a trio of high-tech solutions for today’s
businesses including CheckOut, a web-based POS
(cid:90)(cid:96)(cid:90)(cid:91)(cid:76)(cid:84)(cid:34)(cid:3)Watcher(cid:19)(cid:3)(cid:72)(cid:3)(cid:93)(cid:80)(cid:75)(cid:76)(cid:86)(cid:20)(cid:84)(cid:86)(cid:85)(cid:80)(cid:91)(cid:86)(cid:89)(cid:80)(cid:85)(cid:78)(cid:3)(cid:90)(cid:96)(cid:90)(cid:91)(cid:76)(cid:84)(cid:34)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)
Fastrack, a vehicle and asset-tracking service.
PLDT ALPHA Enterprise and ePLDT expanded their network of
world-class data centers with the launch of VITRO Data Centers
in Mandaue, Cebu and in Subic, Zambales. The new facilities now
serve as the primary data centers of customers in the Visayas-
Mindanao region and for businesses north of Luzon. The Subic
facility also functions as a secondary or back-up site for Luzon-
based enterprise co-locators. The data center facilities are capable
of concurrent maintainability, a major criterion of a Tier 3 data
center, and part of a network of data centers together with VITRO
Pasig.
2012 ANNUAL REPORT
15
DEMOCRATIZING ACCESS
As the PLDT Group’s network and services improved, it offered packaged solutions
that would make its services accessible to a greater number of the population.
PLDT launched myBro with the rebranding of
Canopy and WiMax services of Smart Bro,
leading to 17,000 gross activations, the highest
since 2009 and up 71% from 2011.
Smart launched a new marketing campaign with the catch phrase “Live
More” which enabled it to reposition Smart as the premium cellular brand
that delivers the country’s best mobile phone and mobile internet service.
The Live More message – delivered through a series of humorous ads –
is that you can make the most out of life if you have the best mobile phone
service. And that conversely, you lose a part of your life if you don’t.
Smart launched the Smart Postpaid Freedom Plan,
(cid:94)(cid:79)(cid:80)(cid:74)(cid:79)(cid:3)(cid:74)(cid:72)(cid:89)(cid:89)(cid:80)(cid:76)(cid:90)(cid:3)(cid:85)(cid:86)(cid:3)(cid:196)(cid:95)(cid:76)(cid:75)(cid:3)(cid:84)(cid:86)(cid:85)(cid:91)(cid:79)(cid:83)(cid:96)(cid:3)(cid:77)(cid:76)(cid:76)(cid:90)(cid:19)(cid:3)(cid:83)(cid:86)(cid:74)(cid:82)(cid:20)(cid:80)(cid:85)(cid:3)(cid:87)(cid:76)(cid:89)(cid:80)(cid:86)(cid:75)(cid:90)(cid:19)(cid:3)
and obligations, thus enabling subscribers to pay only
(cid:77)(cid:86)(cid:89)(cid:3)(cid:94)(cid:79)(cid:72)(cid:91)(cid:3)(cid:91)(cid:79)(cid:76)(cid:96)(cid:3)(cid:92)(cid:90)(cid:76)(cid:21)(cid:3)(cid:40)(cid:83)(cid:90)(cid:86)(cid:19)(cid:3)(cid:58)(cid:84)(cid:72)(cid:89)(cid:91)(cid:3)(cid:80)(cid:85)(cid:91)(cid:89)(cid:86)(cid:75)(cid:92)(cid:74)(cid:76)(cid:75)(cid:3)(cid:80)(cid:91)(cid:90)(cid:3)(cid:48)(cid:85)(cid:196)(cid:85)(cid:80)(cid:91)(cid:96)(cid:3)
Plan 3500, a variation of the telco’s premium offering
(cid:72)(cid:85)(cid:75)(cid:3)(cid:75)(cid:92)(cid:73)(cid:73)(cid:76)(cid:75)(cid:3)(cid:72)(cid:90)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:76)(cid:85)(cid:91)(cid:89)(cid:96)(cid:20)(cid:83)(cid:76)(cid:93)(cid:76)(cid:83)(cid:3)(cid:48)(cid:85)(cid:196)(cid:85)(cid:80)(cid:91)(cid:96)(cid:3)(cid:87)(cid:83)(cid:72)(cid:85)(cid:3)(cid:94)(cid:79)(cid:80)(cid:74)(cid:79)(cid:3)
treated its users to the same topnotch perks available
(cid:91)(cid:86)(cid:3)(cid:72)(cid:83)(cid:83)(cid:3)(cid:86)(cid:91)(cid:79)(cid:76)(cid:89)(cid:3)(cid:48)(cid:85)(cid:196)(cid:85)(cid:80)(cid:91)(cid:96)(cid:3)(cid:87)(cid:83)(cid:72)(cid:85)(cid:79)(cid:86)(cid:83)(cid:75)(cid:76)(cid:89)(cid:90)(cid:21)
For its prepaid subscribers, Smart launched a string
of what it called the ‘ultimate unlimited’ services,
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text services with data. The Tri-Net Unli series for
example, allows the user to make unli calls and texts
to any Smart, Talk ‘N Text, or Sun Cellular subscriber
for as low as just Php40 a day. With unlimited SMS
to all networks, Mega 250 is valid for 30 days and
loaded with 180 minutes of calls to Smart, Sun and
Talk ‘N Text as well as 100 mb of mobile internet.
16
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY
Smart also launched various new mobile data plans such as the
Smart FlexiSurf Plans, a set of worry-free postpaid broadband
packages that come in various combinations and price points.
These are the Php299 per month SIM-only plan, the Power Plug-
It Plan 499, and the Pocket Wi-Fi Plan 599. FlexiSurf plans may
also be bundled with a netbook or a tablet of their choice, for an
amortized and discounted amount.
(cid:58)(cid:92)(cid:85)(cid:3)(cid:42)(cid:76)(cid:83)(cid:83)(cid:92)(cid:83)(cid:72)(cid:89)(cid:3)(cid:80)(cid:85)(cid:91)(cid:89)(cid:86)(cid:75)(cid:92)(cid:74)(cid:76)(cid:75)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:196)(cid:3)(cid:89)(cid:90)(cid:91)(cid:20)(cid:80)(cid:85)(cid:20)(cid:91)(cid:79)(cid:76)(cid:20)(cid:84)(cid:72)(cid:89)(cid:82)(cid:76)(cid:91)(cid:3)SunDroid
Rush Plan 600 which offers a free Android Alcatel
smartphone and Alcatel tablet with unlimited Sun calls and
texts, 350 texts to other networks and Php250 consumable
for other services. It also made available the lowest-priced
broadband plan in the market called Sun Broadband Plan
250 with 35 hours of internet per month to replace the
earlier released Plan 299 with 30 hours of internet.
Also during the year, Sun Cellular launched new products for corporate
2G postpaid: Sun Plan 599 with unlimited Sun calls, unlimited texts
to all networks and a choice of various free handsets such as Nokia
200, Nokia 202, Alcatel Glory X918N, Alcatel OT903 or Alcatel Glory 2
(cid:92)(cid:85)(cid:75)(cid:76)(cid:89)(cid:3)(cid:72)(cid:3)(cid:25)(cid:27)(cid:20)(cid:84)(cid:86)(cid:85)(cid:91)(cid:79)(cid:3)(cid:79)(cid:86)(cid:83)(cid:75)(cid:80)(cid:85)(cid:78)(cid:3)(cid:87)(cid:76)(cid:89)(cid:80)(cid:86)(cid:75)(cid:34)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)Sun Fixed Load Plan 500 with
unlimited Sun calls and texts, 1,250 texts to Smart, one hour of calls to
Smart and a free Alcatel Glory smartphone.
Sun Cellular introduced new offerings for corporate
3G postpaid: Sun Business Mobile WiFi Kit for
transport companies. Powered by Sun Broadband,
this offers unlimited Internet connection of up to 7.2
Mbps, along with a free mobile WiFi router and WiFi
sticker. This aims to give transport companies more
advertising leverage through the added customer
perk of installing WiFi service in their vehicles.
2012 ANNUAL REPORT
2012 ANNUAL REPORT
17
17
AWARDS AND RECOGNITION
In recognition of its various innovative initiatives, the PLDT Group received
numerous awards during the year.
(cid:55)(cid:51)(cid:43)(cid:59)(cid:3)(cid:42)(cid:79)(cid:72)(cid:80)(cid:89)(cid:84)(cid:72)(cid:85)(cid:3)(cid:52)(cid:72)(cid:85)(cid:92)(cid:76)(cid:83)(cid:3)(cid:61)(cid:21)(cid:3)(cid:55)(cid:72)(cid:85)(cid:78)(cid:80)(cid:83)(cid:80)(cid:85)(cid:72)(cid:85)(cid:3)(cid:87)(cid:83)(cid:72)(cid:74)(cid:76)(cid:75)(cid:3)(cid:196)(cid:89)(cid:90)(cid:91)(cid:3)
(cid:72)(cid:84)(cid:86)(cid:85)(cid:78)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:89)(cid:86)(cid:90)(cid:91)(cid:76)(cid:89)(cid:3)(cid:86)(cid:77)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:55)(cid:79)(cid:80)(cid:83)(cid:80)(cid:87)(cid:87)(cid:80)(cid:85)(cid:76)(cid:90)(cid:187)(cid:3)(cid:83)(cid:76)(cid:72)(cid:75)(cid:80)(cid:85)(cid:78)(cid:3)(cid:42)(cid:44)(cid:54)(cid:90)(cid:3)
(cid:80)(cid:85)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:24)(cid:25)(cid:91)(cid:79)(cid:3)(cid:40)(cid:85)(cid:85)(cid:92)(cid:72)(cid:83)(cid:3)(cid:55)(cid:86)(cid:83)(cid:83)(cid:3)(cid:86)(cid:77)(cid:3)(cid:40)(cid:90)(cid:80)(cid:72)(cid:187)(cid:90)(cid:3)(cid:91)(cid:86)(cid:87)(cid:3)(cid:74)(cid:86)(cid:84)(cid:87)(cid:72)(cid:85)(cid:80)(cid:76)(cid:90)(cid:3)(cid:73)(cid:96)(cid:3)
(cid:45)(cid:80)(cid:85)(cid:72)(cid:85)(cid:74)(cid:76)(cid:40)(cid:90)(cid:80)(cid:72)(cid:19)(cid:3)(cid:72)(cid:3)(cid:83)(cid:76)(cid:72)(cid:75)(cid:80)(cid:85)(cid:78)(cid:3)(cid:87)(cid:92)(cid:73)(cid:83)(cid:80)(cid:74)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:80)(cid:85)(cid:3)(cid:40)(cid:90)(cid:80)(cid:72)(cid:21)
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(cid:64)(cid:76)(cid:72)(cid:89)(cid:3)(cid:77)(cid:86)(cid:89)(cid:3)(cid:58)(cid:84)(cid:72)(cid:89)(cid:91)(cid:3)(cid:55)(cid:89)(cid:76)(cid:90)(cid:80)(cid:75)(cid:76)(cid:85)(cid:91)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:42)(cid:44)(cid:54)(cid:3)(cid:53)(cid:72)(cid:87)(cid:86)(cid:83)(cid:76)(cid:86)(cid:85)(cid:3)(cid:51)(cid:21)(cid:3)(cid:53)(cid:72)(cid:97)(cid:72)(cid:89)(cid:76)(cid:85)(cid:86)(cid:3)(cid:72)(cid:91)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:24)(cid:28)(cid:91)(cid:79)(cid:3)
(cid:59)(cid:76)(cid:83)(cid:76)(cid:74)(cid:86)(cid:84)(cid:3)(cid:40)(cid:90)(cid:80)(cid:72)(cid:3)(cid:40)(cid:94)(cid:72)(cid:89)(cid:75)(cid:90)(cid:3)(cid:80)(cid:85)(cid:3)(cid:41)(cid:72)(cid:85)(cid:78)(cid:82)(cid:86)(cid:82)(cid:19)(cid:3)(cid:59)(cid:79)(cid:72)(cid:80)(cid:83)(cid:72)(cid:85)(cid:75)(cid:21)(cid:3)(cid:48)(cid:91)(cid:3)(cid:72)(cid:83)(cid:90)(cid:86)(cid:3)(cid:73)(cid:72)(cid:78)(cid:78)(cid:76)(cid:75)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:54)(cid:87)(cid:76)(cid:89)(cid:72)(cid:91)(cid:86)(cid:89)(cid:3)
(cid:86)(cid:77)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:64)(cid:76)(cid:72)(cid:89)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:48)(cid:85)(cid:85)(cid:86)(cid:93)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:40)(cid:94)(cid:72)(cid:89)(cid:75)(cid:3)(cid:77)(cid:86)(cid:89)(cid:3)(cid:58)(cid:84)(cid:72)(cid:89)(cid:91)(cid:3)(cid:53)(cid:76)(cid:91)(cid:87)(cid:79)(cid:86)(cid:85)(cid:76)(cid:3)(cid:72)(cid:91)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:25)(cid:85)(cid:75)(cid:3)
(cid:40)(cid:90)(cid:80)(cid:72)(cid:3)(cid:42)(cid:86)(cid:84)(cid:84)(cid:92)(cid:85)(cid:80)(cid:74)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:90)(cid:3)(cid:40)(cid:94)(cid:72)(cid:89)(cid:75)(cid:90)(cid:3)(cid:80)(cid:85)(cid:3)(cid:58)(cid:80)(cid:85)(cid:78)(cid:72)(cid:87)(cid:86)(cid:89)(cid:76)(cid:19)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:59)(cid:79)(cid:76)(cid:3)(cid:52)(cid:86)(cid:90)(cid:91)(cid:3)(cid:48)(cid:85)(cid:85)(cid:86)(cid:93)(cid:72)(cid:91)(cid:80)(cid:93)(cid:76)(cid:3)
(cid:42)(cid:86)(cid:84)(cid:87)(cid:72)(cid:85)(cid:96)(cid:3)(cid:40)(cid:94)(cid:72)(cid:89)(cid:75)(cid:3)(cid:72)(cid:91)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:40)(cid:90)(cid:80)(cid:72)(cid:3)(cid:42)(cid:44)(cid:54)(cid:3)(cid:40)(cid:94)(cid:72)(cid:89)(cid:75)(cid:90)(cid:3)(cid:79)(cid:76)(cid:83)(cid:75)(cid:3)(cid:80)(cid:85)(cid:3)(cid:52)(cid:72)(cid:85)(cid:80)(cid:83)(cid:72)(cid:21)
(cid:55)(cid:51)(cid:43)(cid:59)(cid:3)(cid:89)(cid:76)(cid:74)(cid:76)(cid:80)(cid:93)(cid:76)(cid:75)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:58)(cid:76)(cid:89)(cid:93)(cid:80)(cid:74)(cid:76)(cid:3)(cid:55)(cid:89)(cid:86)(cid:93)(cid:80)(cid:75)(cid:76)(cid:89)(cid:3)(cid:86)(cid:77)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:64)(cid:76)(cid:72)(cid:89)(cid:3)(cid:72)(cid:94)(cid:72)(cid:89)(cid:75)(cid:3)(cid:72)(cid:85)(cid:75)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:41)(cid:76)(cid:90)(cid:91)(cid:3)(cid:80)(cid:85)(cid:3)
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(cid:40)(cid:94)(cid:72)(cid:89)(cid:75)(cid:90)(cid:3)(cid:77)(cid:86)(cid:89)(cid:3)(cid:40)(cid:90)(cid:80)(cid:72)(cid:3)(cid:55)(cid:72)(cid:74)(cid:80)(cid:196)(cid:74)(cid:3)(cid:79)(cid:76)(cid:83)(cid:75)(cid:3)(cid:80)(cid:85)(cid:3)(cid:58)(cid:79)(cid:72)(cid:85)(cid:78)(cid:79)(cid:72)(cid:80)(cid:19)(cid:3)(cid:42)(cid:79)(cid:80)(cid:85)(cid:72)(cid:21)(cid:3)(cid:3)(cid:55)(cid:51)(cid:43)(cid:59)(cid:3)(cid:94)(cid:72)(cid:90)(cid:3)(cid:72)(cid:83)(cid:90)(cid:86)(cid:3)(cid:86)(cid:85)(cid:76)(cid:3)(cid:86)(cid:77)(cid:3)
(cid:91)(cid:79)(cid:76)(cid:3)(cid:90)(cid:80)(cid:95)(cid:3)(cid:196)(cid:85)(cid:72)(cid:83)(cid:80)(cid:90)(cid:91)(cid:90)(cid:3)(cid:77)(cid:86)(cid:89)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:42)(cid:72)(cid:89)(cid:89)(cid:80)(cid:76)(cid:89)(cid:3)(cid:44)(cid:91)(cid:79)(cid:76)(cid:89)(cid:85)(cid:76)(cid:91)(cid:3)(cid:41)(cid:92)(cid:90)(cid:80)(cid:85)(cid:76)(cid:90)(cid:90)(cid:3)(cid:40)(cid:87)(cid:87)(cid:83)(cid:80)(cid:74)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:90)(cid:3)(cid:40)(cid:94)(cid:72)(cid:89)(cid:75)(cid:21)(cid:3)
(cid:58)(cid:84)(cid:72)(cid:89)(cid:91)(cid:3)(cid:94)(cid:72)(cid:90)(cid:3)(cid:89)(cid:76)(cid:74)(cid:86)(cid:78)(cid:85)(cid:80)(cid:97)(cid:76)(cid:75)(cid:3)(cid:72)(cid:90)(cid:3)(cid:54)(cid:87)(cid:76)(cid:89)(cid:72)(cid:91)(cid:86)(cid:89)(cid:3)(cid:86)(cid:77)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:64)(cid:76)(cid:72)(cid:89)(cid:3)(cid:72)(cid:91)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:40)(cid:90)(cid:80)(cid:72)(cid:3)
(cid:42)(cid:86)(cid:84)(cid:84)(cid:92)(cid:85)(cid:80)(cid:74)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:40)(cid:94)(cid:72)(cid:89)(cid:75)(cid:90)(cid:3)(cid:80)(cid:85)(cid:3)(cid:58)(cid:80)(cid:85)(cid:78)(cid:72)(cid:87)(cid:86)(cid:89)(cid:76)(cid:19)(cid:3)(cid:41)(cid:76)(cid:90)(cid:91)(cid:3)(cid:44)(cid:84)(cid:76)(cid:89)(cid:78)(cid:80)(cid:85)(cid:78)(cid:3)(cid:52)(cid:72)(cid:89)(cid:82)(cid:76)(cid:91)(cid:3)
(cid:42)(cid:72)(cid:89)(cid:89)(cid:80)(cid:76)(cid:89)(cid:3)(cid:72)(cid:91)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:25)(cid:23)(cid:24)(cid:25)(cid:3)(cid:59)(cid:76)(cid:83)(cid:76)(cid:74)(cid:86)(cid:84)(cid:90)(cid:3)(cid:40)(cid:90)(cid:80)(cid:72)(cid:3)(cid:40)(cid:94)(cid:72)(cid:89)(cid:75)(cid:90)(cid:3)(cid:79)(cid:76)(cid:83)(cid:75)(cid:3)(cid:80)(cid:85)(cid:3)(cid:41)(cid:72)(cid:85)(cid:78)(cid:82)(cid:86)(cid:82)(cid:19)(cid:3)
(cid:72)(cid:85)(cid:75)(cid:3)(cid:3)(cid:52)(cid:86)(cid:90)(cid:91)(cid:3)(cid:48)(cid:85)(cid:85)(cid:86)(cid:93)(cid:72)(cid:91)(cid:80)(cid:93)(cid:76)(cid:3)(cid:42)(cid:86)(cid:84)(cid:87)(cid:72)(cid:85)(cid:96)(cid:3)(cid:72)(cid:91)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:25)(cid:23)(cid:24)(cid:25)(cid:3)(cid:40)(cid:90)(cid:80)(cid:72)(cid:3)(cid:42)(cid:44)(cid:54)(cid:3)(cid:40)(cid:94)(cid:72)(cid:89)(cid:75)(cid:90)(cid:3)(cid:80)(cid:85)(cid:3)
(cid:52)(cid:72)(cid:85)(cid:80)(cid:83)(cid:72)(cid:21)(cid:3)(cid:59)(cid:79)(cid:76) Netphone (cid:182)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:94)(cid:86)(cid:89)(cid:83)(cid:75)(cid:187)(cid:90)(cid:3)(cid:196)(cid:89)(cid:90)(cid:91)(cid:3)(cid:90)(cid:84)(cid:72)(cid:89)(cid:91)(cid:87)(cid:79)(cid:86)(cid:85)(cid:76)(cid:3)(cid:73)(cid:72)(cid:74)(cid:82)(cid:76)(cid:75)(cid:3)(cid:73)(cid:96)(cid:3)(cid:72)(cid:85)(cid:3)
(cid:86)(cid:87)(cid:76)(cid:89)(cid:72)(cid:91)(cid:86)(cid:89)(cid:20)(cid:84)(cid:72)(cid:85)(cid:72)(cid:78)(cid:76)(cid:75)(cid:3)(cid:87)(cid:83)(cid:72)(cid:91)(cid:77)(cid:86)(cid:89)(cid:84)(cid:3)(cid:182)(cid:3)(cid:89)(cid:76)(cid:74)(cid:76)(cid:80)(cid:93)(cid:76)(cid:75)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:41)(cid:76)(cid:90)(cid:91)(cid:3)(cid:48)(cid:85)(cid:85)(cid:86)(cid:93)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:3)(cid:40)(cid:94)(cid:72)(cid:89)(cid:75)(cid:3)
(cid:72)(cid:91)(cid:3)(cid:91)(cid:79)(cid:76)(cid:3)(cid:25)(cid:23)(cid:24)(cid:25)(cid:3)(cid:40)(cid:90)(cid:80)(cid:72)(cid:3)(cid:42)(cid:86)(cid:84)(cid:84)(cid:92)(cid:85)(cid:80)(cid:74)(cid:72)(cid:91)(cid:80)(cid:86)(cid:85)(cid:90)(cid:3)(cid:40)(cid:94)(cid:72)(cid:89)(cid:75)(cid:90)(cid:3)(cid:80)(cid:85)(cid:3)(cid:58)(cid:80)(cid:85)(cid:78)(cid:72)(cid:87)(cid:86)(cid:89)(cid:76)(cid:21)
For its part, Sun Cellular was recognized for the second
year in a row as the Philippines’ Mobile Service Provider of
the Year for 2012 by Frost & Sullivan, a global research and
(cid:74)(cid:86)(cid:85)(cid:90)(cid:92)(cid:83)(cid:91)(cid:72)(cid:85)(cid:74)(cid:96)(cid:3)(cid:196)(cid:89)(cid:84)(cid:21)
18
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY
Smart’s electronic medical records and referral system
called Secured Health Information Network and
Exchange (SHINE) was likewise recognized as Best
Community Telecom Project at Telecom Asia held
in Bangkok, Thailand and as Best Emerging Market
Initiative at the 2012 Asia Communication Awards.
SHINE was also cited as one of the country’s Top 10
health programs by Health Market Innovations in the
Philippines.
SPi global Holdings, Inc. (SPi global) won the Best BPO
Award for the 2nd time in Vietnam during the 2012 Sao
Khue Awards given by the Vietnam Software Association
(VINASA), which recognized the Vietnam operations of
SPi global for its “Outstanding BPO Service” involving
the company’s “Conversion Solutions” for scanning and
digitizing over 30 million pages of scholarly materials in just
18 months.
PLDT and Smart clinched the award for Best Telecommunications Conference
at the first Asian Conference Summit and Awards held in Singapore for its 7th
Asian Carriers’ Conference (ACC). An annual event, the ACC is attended by
almost 1,000 delegates from 45 countries. It was cited for providing a venue for
leaders around the world from the wholesale fixed and mobile telecom carriers
to meet and engage with delegates from telecoms network and infrastructure
providers, applications and service developers, handset and equipment
manufacturers, and entertainment and content producers and distributors.
Smart was cited as the Company of the Year at
the 11th Philippine Quill Awards after clinching a
record-setting 14 Excellence Awards at the annual
competition held by the International Association of
Business Communicators Philippines.
PLDT, through its wholly-owned subsidiary ePLDT, Inc., has gained the
Microsoft Silver Certified Partner status for Messaging and Hosting,
the first Philippine company to receive this distinction. This directly
upgrades the Company’s hosted Microsoft offerings, particularly
Hosted Exchange, which is the leading enterprise email platform
providing business-class email, calendar and contacts on computers,
phones and web browsers. Microsoft Silver Certified Partners benefit
from exclusive support and resources directly provided by Microsoft.
3_PLDTar12 _rev.indd 19
5/9/13 12:52 PM
2012 ANNuAL REPORT
19
FIBER TO ThE cOmmunITy
More Than jusT brIDGInG PeoPLe,
PLDT has been coMMITTeD In eMPowerInG LocaL coMMunITIes
wITh TechnoLoGy anD InforMaTIon TooLs for DeveLoPMenT
In LIne wITh The coMPany’s GoaL TowarDs naTIon-buILDInG.
20
PhiliPPine long distance telePhone comPany
3_PLDTar12 _rev.indd 20
5/9/13 11:57 PM
pldt group csr
r e p o r t
GUIDED BY THE VIEW THAT BUSINESS MUST HAVE A SOCIAL PURPOSE, THE PLDT GROUP
TOOK ON VARIOUS CORPORATE SOCIAL RESPONSIBILITY INITIATIVES TO HELP OUR
PEOPLE IMPROVE THEIR LIVES THROUGH DISASTER PREPAREDNESS AND RESPONSE,
SUSTAINABLE LIVELIHOOD, ENVIRONMENTAL PROTECTION, DIGITAL LITERACY, BETTER
QUALITY EDUCATION, AND HEALTHCARE.
“FOR US, IT IS ESSENTIAL THAT BUSINESSES TAKE ON A SOCIAL DIMENSION…
WE’RE REALLY HERE BECAUSE WE WANT TO IMPROVE LIVES,” PLDT
CHAIRMAN MANUEL V. PANGILINAN SAID.
BRIDGE DURING DISASTERS
in november 2012, pldt together with smart, sun, and
PLDT-Smart Foundation (PSF) joined hands with affi liated
companies under the Metro Pacifi c Investment Corporation to
form Tulong Kapatid, the consolidated disaster preparedness
and response effort of the group.
The newly-established consortium faced its fi rst major
test just a month later, when Typhoon Pablo slammed into
mindanao, which caused massive death and destruction in
an area of the country that hardly ever experienced such
weather disturbances.
under the banner of Tulong Kapatid, tV5 staged a telethon
that raised over php100 million in contributions for relief
and post-disaster rehabilitation efforts in the provinces of
davao oriental and compostela Valley, which had borne
the brunt of Typhoon Pablo.
food, water, and relief goods
using these resources, pldt, smart, tV5 and meralco
delivered
to affected
communities in the two provinces. maynilad deployed a mobile
water purifi er to produce potable water. Meralco dispatched 38
linemen to help restore power in davao oriental.
smart set up Libreng Tawag or free call stations to enable
typhoon victims to call their families for assistance. smart
engineers also worked double time to restore damaged
cell towers. in collaboration with Telecoms Sans Frontieres
and Vodafone Foundation, smart set up an “instant cellsite”
in Banganga and cateel, davao oriental using equipment
that fi t into four suit cases. This facility provided vital
communications support for government and international
relief agencies at the frontlines.
In the post-disaster, rehabilitation phase, Tulong Kapatid is
working with the davao oriental provincial government, the
nhA and the philippine contractors Association to build
houses for around 300 families in Banganga.
in cooperation with the corporate network for disaster
Response (CNDR), Smart also enabled the fl ood-prone
barangays in metro manila, cagayan de oro, Bacolod,
and Dumaguete to develop community fl ood preparedness
plans and conduct fl ood drills that involved residents,
the local government, law enforcers, public schools and
volunteer groups.
smart and sun cellular agreed to support the efforts of
the department of science and technology (dost) to set
up the national operational Assessment of hazards and
Risks (noAh), a major government program to improve the
country’s weather monitoring and fl ood warning system.
smart and sun committed to host the
dost’s automated rain gauges in
600 of its cell sites all over the
country. s m a r t a l s o h e l p e d
d e v e l o p and launch the project
noAh mobile App for Android
to enable smartphone
devices
users to quickly access the weather
information and alerts available on
the dost’s project noAh website.
3_PLDTar12 _rev.indd 21
5/9/13 9:23 PM
2012 AnnuAl RepoRt
21
FIBER TO THE COMMUNITY
MORE THAN JUST BRIDGING PEOPLE,
PLDT HAS BEEN COMMITTED IN EMPOWERING LOCAL COMMUNITIES
WITH TECHNOLOGY AND INFORMATION TOOLS FOR DEVELOPMENT
IN LINE WITH THE COMPANY’S GOAL TOWARDS NATION-BUILDING.
66,000
trees
being planted
Top: PLDT launched its 66K M.V.P. Trees Movement for volunteerism and partnership
that aims to plant 66,000 trees for a year up to July 14, 2013. The areas covered by the
project are Benguet, Pampanga, Bulacan, Marikina, Iloilo, Cebu, and Davao.
Left: KILOS, another partner women’s organization with 30 members, from Barangay
Gumian, Infanta, Quezon, was provided with four high-speed electric sewing machines as
a support to their Eco-Bag Project. Besides giving alternative income to the members, the
project also supports the “No Plastic-Use Policy” of Infanta, Quezon, providing reused and
recycled bag materials sold cheaply at the community market.
Creating livelihood,
Caring for the environment
Pldt’s initiatives to preserve the environment and improve
the people’s quality of life have also produced other benefits
such as new sources of livelihood.
at the center for Rural technology and development of the
Philippine Business for social Progress (PBsP), some of the
80 members of farmer organization Kanlungan received a
training on vermi-compost production with the assistance
of Pldt. aside from being a source of income, the vermi-
compost production promotes solid waste management
and provides farmers with low-cost organic fertilizers.
to limit the use of plastic bags and promote the so-called
eco-bags, Pldt donated four high-speed sewing machines
to KILOS, a women’s organization in gumian, infanta,
Quezon. the sewing machines were used to recycle plastic
bags sold cheaply at the community market in the province.
the vermi-compost and eco-bag projects were supported
by the local government of infanta through the municipal
Environment Natural Resources Office.
In the case of the five year-old PLDT TELEpuno project, the
objective was to rehabilitate the infanta-Real Watershed
Forest Reserve in the boundaries of infanta and Real
in Quezon province by planting trees in the area. But a
collateral effect was an alternative livelihood project for its
partner communities within the watershed forest reserve in
cooperation with PBsP.
until July 14, 2013. Under People’s lives depend on trees
environmental greening project, other mVP-led companies
participated in the areas of Benguet, Pampanga, Bulacan,
marikina, iloilo, cebu and davao.
In late 2012, PLDT constructed a fish nursery and provided
5,500 fries to the Samahan ng Magbubukid at Mangingisda
sa Barangay Cawayan, a farmer organization that served as
a partner in the fish production project.
smart continued to spearhead the marikina Watershed
initiative, a broad-based multi-sectoral cooperation initiated
by the Philippine disaster Recovery Foundation (PdRF) that
seeks to help save and restore the marikina Watershed. the
denuded state of the marikina Watershed had contributed
to the massive flooding in Metro Manila during Typhoon
ondoy in late 2009. in 2012, smart conducted reforestation
activities and various projects as part of a comprehensive
rehabilitation program for the vital watershed.
another major csR initiative in 2012 for Pldt was its
support for the Philippine international River summit in
iloilo city. co-presented by Pldt and smart, the summit
drew participants from various countries including canada,
czech Republic, and indonesia to discuss ways of saving
vital waterways from pollution. the holding of the summit
complemented the ongoing projects of smart and sun
Cellular to develop a flood monitoring and water system in
18 of the country’s major river basins, including Iloilo, under
Project noah.
on July 14, 2012, in time for mVP’s birthday celebration,
Pldt launched the 66K m.V.P. (movement for Volunteerism
and Partnership) trees project aimed at planting 66,000 trees
smart also partnered with Gawad Kalinga (GK) in providing
sustainable livelihood for its community in sooc, iloilo by
‘upcycling’ tarpaulins used for smart’s merchandising
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Left: Project Zero, a project launched by Smart and its GK partners, is an “upcycling”
project that trains GK residents to design, create and market handcrafted designer
bags.
Lower left: Benefi ciaries of GabayGuro – one of PLDT-Smart Foundation’s landmark
programs – are all smiles as they listen to a tribute to the society’s unsung heroes. The
Gabay Guro seeks to enhance education in the country through scholarship grants and
English profi ciency and computer literacy training programs for teachers.
Lower right: PLDT, together with Smart, recently co-presented the fi rst-ever Philippine
International River Summit in Iloilo City. A well-attended three-day summit which
Philippine President Benigno Aquino III graced, it discussed the important environmental
issues of the country and the current state of its rivers. This signifi cant endeavor was
made possible through the support of both telco giants.
activities. called Project Zero, GK residents were trained
in designing, creating and marketing handcrafted high-
value designer bags through the help of fashion designer
PJ aranador. a follow-up project Silya is also preparing gK
communities to expand their tarpaulin upcycling business to
include furniture and other accessories. Pldt, meanwhile,
donated sewing machines to the gK community to support
livelihood projects.
in partnership with PBsP and motolite, Pldt donated used
lead-acid batteries (UlaBs) for recycling. the Balik Baterya
program made possible the proper disposal of hazardous
waste from the batteries while generating funds through
the production of new automotive and industrial batteries.
since the program began in 2006, Pldt has donated
964 tons of UlaBs worth Php20.12 million, making it the
biggest contributor of the program.
in 2012, Pldt donated 144 tons of UlaBs amounting
to Php3.12 million. the funds generated by the program
that year funded the reforestation of 13 hectares of the
montalban-Wawa sub-Watersheds in Rizal province and
helped build classrooms for Bangkerohan and nenita
elementary schools in northern samar.
other livelihood programs were the training in micro
businesses given such as sale of Pldt-smart cards,
soap making, and personal grooming services for poor
communities in muntinlupa and malabon through the
catmon elementary school Parents and teachers’
association, and Quezon typhoon victims. Pldt also
donated old directories to be used in making baskets,
decors and gift items by women inmates in camp Karingal
and Quezon city jails.
leading in digital literaCy
the Pldt managers’ club, inc. (mci) in partnership with
PsF expanded its Gabay Guro program by providing
scholarships to over 500 public school teachers in state
universities and colleges all over the country. it is now
gearing up to broaden its support for public school teachers
by collaborating with local governments and over 30 partner
state colleges and universities in different parts of the country.
Gabay Guro hopes to eventually assist fi ve teacher scholars
per year per province.
in a grand celebration in november 2012, some 15,000
teachers were treated to a day of festivities and entertainment
where a public school teacher from cavite was honored as
teacher of the year and another educator from makati won
a house and lot in the grand raffl e sponsored by Vista Land.
to promote digital education in the Philippines, Pldt
provided training to 1,000 teachers and students through its
infoteach in collaboration with the department of education
(deped), intel Philippines, Philippine community ecenter
network and the UPoU.
extending its reach to include marikina, tondo, isabela,
legaspi, cebu, iloilo, Bacolod, general santos, davao, and
Zamboanga, infoteach offered its top teacher graduates
scholarships to pursue advanced courses in UPoU.
Pldt also donated computer units and facilitated internet
access for the establishment of a community e-center.
this was in support of the elearning Ville Program, a multi-
sectoral program seeking to create a learning hub through
technology. Under the Philippine digital literacy for Women
campaign, Pldt mobilized the resources needed to train
3_PLDTar12 _rev.indd 23
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2012 annUal RePoRt
23
10,000 women in grassroots communities. this activity
was also in partnership with UPoU, Philippine community
ecenter network, and intel Philippines.
For its teachers development Program, Pldt donated
computers to 44 public schools in Quezon province. the
program in partnership with UPoU, deped and the Quezon
province local government aims to upgrade teachers’ skills
and knowledge of science, math and language through
enrolment at UPoU.
Pldt also donated a two-story building with six classrooms
and a computer laboratory at catmon elementary school in
Malabon that benefited 827 students. The program dubbed
Paaralang Laan sa Dunong at Talino was in partnership
with PBsP. as part of the Balik Eskwela program, Pldt
also donated paint and school supplies and helped in the
cleaning and gardening of Putatan elementary school in
muntinlupa, catmon elementary school in malabon, and
luyang elementary school in cebu.
Promoting innovation in eduCation and arts
Working with PsF, smart has strengthened its partnership
with the central Visayan institute Foundation (cViF) to
promote the dynamic learning Program (dlP), a teaching
method proven to significantly improve student performance
despite the lack of qualified teachers, textbooks, and facilities.
smart and PsF assisted cViF in bringing dlP to three more
deped school divisions in sagay city, negros oriental,
Basilan, and lamitan, Basilan in addition to cagayan de oro,
which adopted dlP in 2011. to make it easier to propagate
dlP, smart created several videos from three minutes to
over an hour long for use as introductory materials for the
program.
smart also reoriented two of its major education programs:
the sWeeP for colleges and universities offering electronics
engineering courses and the smart schools Program for
public high schools.
sWeeP’s annual excellence and innovation competition
was expanded to include mobile applications which have
grown in importance because of the soaring popularity of
smartphones. more importantly, winners of the sWeeP
awards are being given the the opportunity to develop their
innovations into commercial services. For example, sWeeP
winners are being assisted to join the national competition of
the ideaspace Foundation to select tech startups that will be
given funding, logistics, legal and mentoring support.
Providing aspiring artists the opportunity to turn trash into
one-of-a-kind works of art, Pldt conducted the Sining
Buhay Para sa Kalikasan – a collage art-making workshop using
recyclable materials in partnership with earth day network
Philippines (EDNP), participated in by 85 young budding artists
from cRiBs Foundation, Persons with disability - Valenzuela,
las Piñas, makati, and Quezon city chapters, and smokey
mountain’s Sandiwaan learning center.
as for the smart schools Program, smart shifted emphasis
to online content generation under the principle of learning by
doing. in 2012, smart expanded its program of promoting
online content development through the Doon Po Sa Amin
program, a crowd-sourcing that collects local stories from
various places in the country.
Building a healthy nation
in partnership with the Philippine children’s medical center
(Pcmc) and the Philippine national Red cross, Pldt
launched Dugong Alay, Katumbas ay Buhay Bloodletting
Program that mobilized employees to donate blood. during
2003-2012, the number of blood donors reached 1,270,
benefiting poor cancer patients from PCMC and as well as
Pldt and smart employees and their relatives.
to promote good nutrition among the poorer families in
urban communities and in calamity areas, Pldt held feeding
programs in eight areas: cebu city, iloilo city, Zamboanga,
laguna, Pampanga, Quezon city, cotabato and Bacolod city.
For operation smile’s 30th anniversary, smart supported
the international ngo’s medical and surgical missions
for children born with cleft lip or palate. in addition to the
company’s financial, connectivity and technical support,
smart also encouraged its subscribers to raise funds for
operation smile through a christmas campaign promoting its
text-to-donate facility.
Pldt also continued to provide free medical and dental
services as well as free medicines to victims of calamities,
poor communities and indigenous groups.
964
tOns Of ulabs
dOnated tO-date
1,270
blOOd
dOnOrs
44
public schOOls
partnered fOr teacher
develOpment prOgram
1,000
teachers & students
trained thrOugh
infOteach
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Upper left: Also part of MVP’s 66th birthday celebration were
the granting of Php3.5 million to MVP-chaired Kapampangan
Development Foundation (KDF) from MVP himself and PSF for
the Pampanga midwives’ birthing clinics, KDF’s donation of
wheelchairs, walkers and prosthetics to underprivileged recipients.
Upper right: PLDT, in partnership with EDNP, held a collage
art-making workshop using recyclable materials. The one-day
workshop dubbed Sining Buhay Para sa Kalikasan provided
young aspiring artists from CRIBS Foundation, Persons with
Disability – Valenzuela, Las Piñas, Makati and Quezon City
chapters, and Smokey Mountain’s Sandiwaan Learning Center
an opportunity to turn trash into one-of-a-kind works of art.
Middle: PLDT employees continuously support the Company’s
“Dugong Alay, Katumbas ay Buhay” bloodletting program.
Lower left: For Operation Smile’s 30th Anniversary, Smart
entered into an agreement with the international NGO with
roots in the Philippines to support medical and surgical
missions for children born with cleft lip or palate. In addition
to the Company’s financial, connectivity and technical
support (through the mobile app), Smart also encouraged
its subscribers to raise funds for Operation Smile through a
Christmas campaign promoting its Text-to-Donate facility.
Lower right: Sun Cellular also provides “Libreng Tawag” to
disaster victims in calling their relatives free of charge.
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2012 annUal RePoRt
25
corporate governance
r e p o r t
pldt remains committed to the highest standards of corporate
governance as articulated in our Articles of Incorporation, By-
laws, manual on corporate governance (cg manual), code
of Business conduct and ethics (code of ethics), and pertinent
laws, rules and regulations. As a publicly-listed Philippine
corporation, pldt is covered by corporate governance rules
and regulations of the philippine securities and exchange
commission (philippine sec) and the philippine stock exchange
(pse). At the same time, pldt has voluntarily complied with the
corporate governance standards of the united states since its
American depositary shares are listed and traded in the new
york stock exchange (nyse). pldt as an associated company
of First Pacific Company Ltd. (First Pacific), which is listed in
the hong Kong stock exchange (hKse), also looks to the
corporate governance standards of hong Kong for guidance
and benchmarking purposes. By committing to high standards
of corporate governance, pldt accepts the challenge of the
demanding regulatory environment in which it finds itself in.
The PLDT Manual on Corporate Governance provides
for the following as regards the Board of Directors:
• the composition of the Board as well as the qualifications and
grounds for disqualification for directorship;
• the requirement that at least 20% of the membership of the
Board of Directors, and in no case less than two members,
must be independent directors and the standards/criteria for
the determination of independent directors;
• the duties and responsibilities of the Board and the individual
directors;
• the manner of conduct of Board meetings including the
requirement to have an independent director present in every
meeting to promote transparency and the need to have
an executive session for non-executive and independent
directors;
• the establishment of board committees, specifically, the
Audit Committee, Executive Compensation Committee
and Governance and Nomination Committee including the
composition and the principal duties and responsibilities of
such committees, as well as the requirement for each Board
Committee to have its own charter; and
• the role of the Chairman as the leader of the Board and as the
prime mover in ensuring compliance with, and the performance
of, corporate governance policies and practices.
pldt also knows that beyond the boundaries of regulations
and compliance lie palpable gains and benefits for companies
that sincerely place emphasis on corporate governance, and
seek to establish corporate cultures anchored on the values
of accountability, integrity, fairness and transparency. pldt
requires loyalty to these values in order to animate and inspire
its governance policies, processes and practices, as these are
rightfully indispensable in creating value for its shareholders,
fulfilling obligations to stakeholders and serving the ends of
good business judgment and sustained profitability.
our structures
Board of Directors
Working and serving pursuant to the mandate given by
the company’s shareholders, our Board has the principal
responsibility of planning, directing, monitoring and improving
our governance policies, processes and practices. our Board
has the task of navigating the company through its toughest
challenges while remaining true to our values. under the
stewardship of the Board, pldt commits to maintain the
highest standards of governance and demands the utmost in
performance and results from its personnel for the benefit of all
its shareholders and stakeholders.
Board Structure and Composition
At the end of 2012, our Board had 12 qualified and competent
members, each highly regarded in their respective fields and/
or industry, who bring together complementary skills and
expertise, and the requisite independence, probity and diligence
in the exercise of their fiduciary duties. Our Board had three
independent directors in Rev. Fr. Bienvenido F. nebres, s.J.,1 mr.
pedro e. Roxas and mr. Alfred V. ty who were selected on the
basis of specific independence criteria set out under applicable
laws and rules, in our By-Laws and in our CG Manual. Our CG
Manual defines an independent director as “a person who is
independent of management and who, apart from his fees and
shareholdings, is free from any business or other relationship
with the company which could or reasonably be perceived to,
materially interfere with his exercise of independent judgment in
carrying out his responsibilities as a director of the company.”
More specific independence criteria are enumerated in Annex
A of our cg manual.
1 Rev. Fr. Bienvenido F. Nebres, S.J. resigned from the Board of Directors on September 25, 2012.
26
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only three members of our Board are, at the same time,
executives of the company. the rest of the members are non-
executive directors of which three are independent directors.
our directors do not receive any form of compensation such
as stock options, performance incentives and bonuses from
the company for their services. they are, however, entitled
to a reasonable per diem for attendance in Board and Board
committee meetings.
the position of chairman of the Board is separate from that of
the Chief Executive Officer (CEO). PLDT Chairman Manuel V.
Pangilinan and Pldt President and ceo napoleon l. nazareno
nonetheless share the responsibility of elevating good corporate
governance and principled performance to a high strategic
priority for the Company. This also reflects the Company’s desire
to adhere to best practices and its recognition of the benefits
that such a separation of the said positions bring.
board responsibilities
at the start of the service of a new director, the chairman, chief
Financial Officer, Corporate Secretary and Chief Governance
Officer give a newly appointed director a briefing on the
company’s structure, business and the responsibilities of the
Board and its committees and how each operates. the new
director is also furnished with copies of all relevant information
about the company and policies applicable to the directors,
including the company’s articles, By-laws, annual Report,
cg manual, code of ethics, and the charters of the Board
committees. Updates on business and governance policies and
requirements principally from the Philippine sec, Pse, United
states securities and exchange commission (U.s. sec) and
nyse, and new laws applicable or relevant to the company and
its business, particularly on financial reporting and disclosures
and corporate governance, are presented in Board meetings or
furnished to the directors.
our cg manual assures that our directors, both new and
currently serving, have access to independent professional
advice, at the company’s expense, as well as access to
management as they may deem necessary to carry out
their duties.
Pldt holds annual corporate governance enhancement
sessions for its directors which provide an opportunity for
our leadership to interact with international experts and
keep abreast with global developments and best practices
in corporate governance and ethics. the governance and
nomination committee (gnc) recommends the content and
speakers for these sessions. all of the current directors have
undergone corporate governance orientation and a majority
of the Board has attended at least one of the six corporate
governance enhancement sessions organized since 2007. Our
directors are also updated on the latest technology trends and
developments that have an impact on the company’s strategy
through technology briefings organized by the Technology
strategy committee (tsc).
to perform its mandate, our Board holds monthly meetings,
the schedule of which is determined at the beginning of the
year. at least one meeting is devoted to discussions with
senior management on the strategic plans and budget, and the
enterprise risk report prepared by senior management through
the group enterprise Risk management department, which has
the responsibility to promulgate, encourage and practice an
integrated risk management framework for the organization,
focusing on ensuring that critical risks are identified, evaluated,
treated and monitored across all functions and units within
the Pldt group. once every quarter, our Board reviews the
quarterly financial reports. Our Board also periodically reviews
reports of Board committees, business operations updates
from the heads of our three business segments and network
and technology strategic plans.
our Board is committed to ensure the continuity of executive
leadership as a critical factor in sustaining the success of the
Pldt group. to this end, a succession planning process
referred to as leadership succession Planning and development
has been established. this enterprise-wide process covers
senior management positions, including the President and
CEO. Reflecting the significance that the Chairman of the
Board of directors attaches to succession planning, the First
Pacific Leadership Academy was reorganized to facilitate the
succession planning process within the Pldt group and other
companies affiliated with First Pacific. The Board’s involvement
in leadership succession Planning and development is
performed through its executive compensation committee
(ecc), which reviews and updates the criteria for employment
and promotion, as well as any training and development plans
for senior management, keeps track of their performance and
development, and reviews their potential career paths.
in 2012, our Board held 15 meetings. the chairman of
the Board, the President and CEO, and five other directors
attended all Board meetings. at least one independent director
was present in all the meetings. the chairman of the audit
committee2 was present in the annual stockholders’ meeting
as well as in the special stockholders’ meeting on march
22. except for one director, all of the other directors each
attended more than 75% of the meetings. The total amount
of per diem provided for the Board of directors in 2012 was
Php28.6 million3.
2 Rev. Fr. Bienvenido F. Nebres, S.J. was the chairman of the Audit Committee at the time that these two stockholders meetings were held.
3 Per diem for each director is Php 200,000 per meeting.
2012 annUal RePoRt
27
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BOARD OF DIRECTORS 2012 MEETINGS
ATTENDANCE PERFORMANCE
Name of Director
Jan
9**
Jan
31
Mar
6
Mar
22**
Mar
22***
May
8
Jun
14
Jun
14****
Jun
14*****
Jul
3
Aug
7
Sept
25
Oct
12**
Nov
6
Dec
4
Totals %age
Manuel V. Pangilinan
Napoleon L. Nazareno
Helen Y. Dee
Ray C. Espinosa
James L. Go
Setsuya Kimura
Bienvenido F. Nebres, S.J.*
Hideaki Ozaki
Ma. Lourdes C. Rausa-Chan
Pedro E. Roxas*
Juan B. Santos
X
X
X
X
X
X
15/15
100%
15/15
100%
11/15
73.3%
15/15
100%
15/15
100%
15/15
100%
-
-
-
-
11/11
100%
X
X
14/15
93.3%
15/15
100%
14/15
93.3%
14/15
93.3%
12/15
80.0%
13/15
86.7%
Tony Tan Caktiong
X
X
Alfred V. Ty*
X
X
* Independent Director
** Special Board Meeting
*** Special Stockholders’ Meeting
**** Annual Meeting of Stockholders
***** Organizational Meeting of the Board
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Board Committees
ADVISORY COMMITTEE 2012 MEETINGS
ATTENDANCE PERFORMANCE
Jan
9*
Jan
31
Mar
6
Mar
22*
Mar
22**
May
8
Jun
14
Jun
14***
Jun
14****
Jul
5
Aug
7
Sept
25
Oct
12*
Nov
6
Dec
4
Artemio V. Panganiban
Oscar S. Reyes
Roberto R. Romulo
Benny S. Santoso
x
x
Washington Z. SyCip
x
x
x
Orlando B. Vea
Christopher H. Young
x
x
x
x
x
x
* Special Board Meeting.
** Special Stockholders’ Meeting.
***Annual Meeting of Stockholders.
**** Organizational Meeting of the Board.
Total
15/15
15/15
13/15
13/15
9/15
15/15
14/15
Advisory Committee
our Board is ably assisted by an advisory committee. the
diversity of the expertise, knowledge and experience of these
advisors serves to complement that of the Board. the advisory
committee provides guidance and suggestions, as necessary,
on matters deliberated upon during Board meetings. the total
per diem given to the members of the advisory committee in
2012 was Php15.8 million4.
to assist in the performance of the Board’s responsibilities and
aid in ensuring compliance with the principles of good corporate
governance, our Board is supported by four standing committees
namely, the audit committee, the governance and nomination
committee, the executive compensation committee, and the
Technology Strategy Committee, whose specific responsibilities
and functions are set forth in their respective written charters.
Audit Committee
The integrity of the Company’s accounting and financial
reporting principles and policies, and system of internal controls,
including the integrity of the Company’s financial statements
and the independent audit thereof are essential components
of Pldt’s corporate governance, and are matters within
the Board’s oversight responsibilities. the audit committee
assists the Board in this key task and provides support to
the Board in discharging its oversight responsibilities over the
company’s compliance with legal and regulatory requirements,
its assessment and management of enterprise risks, its audit
process, and the performance of the company’s internal audit
organization and external auditor (including the external auditor’s
qualifications and independence). The Audit Committee is
composed of three independent directors5, and four advisors.
Each Audit Committee member is financially literate and one
of the advisors is a certified public accountant with financial
management expertise. the charter of the audit committee may
be viewed and downloaded from the Pldt website through the
following link:
http://www.pldt.com.ph/about/management/Documents/
Audit%20Committee%20Charter.pdf
the audit committee’s activities in 2012 with respect to our
external auditor, SyCip, Gorres, Velayo & Co. (SGV & Co.),
included discussions on sgV & co.’s report on the results of the
integrated audit of PLDT’s and its subsidiaries’ 2011 financial
statements prepared in accordance with the Philippine Financial
Reporting Standards
International Financial
(PFRS) and
Reporting Standards (IFRS) and the internal controls over
financial reporting (ICFR), as well as the results of internal and
external quality reviews required of sgV & co. also discussed
were sgV & co.’s required communications to the audit
committee, as well as their independence from Pldt, within
the meaning of the securities act of the Philippine sec and
us sec.
the audit committee also reviewed and approved the following:
• SGV & Co.’s engagements in International Standard on
Assurance Engagements (ISAE) No. 3402, “Assurance
Reports on controls at a service organization”, type B
service audit of ePldt’s Vitro data center, as required by
the latter’s customer, Accenture, and financial statements
audit of Connectivity Unlimited Resource Enterprise (CURE)
as of and for the period ended June 30, 2012, in connection
with ntc’s requirements relating to the divestment plan for
cuRe as committed by Pldt in its acquisition of digital
telecommunications Phils., inc.;
• engagement of e&y australia to perform consulting service
regarding support on customer needs-Based segmentation
Project for smart, and the engagement of e&y singapore to
perform tax services for smart’s subsidiaries; and
• Engagement of Pricewaterhouse Coopers (PwC) member
firm, Isla Lipana & Co., to perform Business Process
alignment Project, and provide manpower services for
Sarbanes-Oxley Act Section 404 (SOX 404) Compliance
Process documentation for digitel mobile Phils., inc.
4 Per diem for each advisory board member is Php200,000 per meeting.
5 With the resignation of Rev. Fr. Bienvenido F. Nebres, S.J., on September 25, 2012, the Audit Committee’s voting members have been momentarily
reduced to two independent directors.
2012 annual RePoRt
29
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the audit committee conducted an evaluation of sgV & co.’s
performance for 2011, resolved to re-appoint sgV & co. as
Pldt’s external auditors for the year 2012, and reviewed
SGV & Co.’s integrated plan for the audit of the 2012 financial
statements and review of icFR of Pldt and its subsidiaries.
the
regards
internal auditor,
the audit committee
as
reviewed, noted or approved the internal audit and Fraud
Risk management group (iaFRmg)’s performance report for
the year 2011, the internal audit Plan for 2012 (original and
updated) and its alignment with business risks, iaFRmg head’s
statement of compliance with the international standards for the
Professional Practice of internal auditing (isPPia), and required
confirmation of the organizational independence of the Internal
audit organization, and resolved to retain the existing Pldt
internal audit charter. the audit committee also discussed the
internal audit’s report on Pldt group’s soX 404 compliance
– management’s overall assessment and conclusions as of
december 31, 2011, the periodic status reports submitted by
internal audit regarding Pldt group’s soX 404 readiness and
compliance as of year-end 2011 and as of year-end 2012, and
the major internal audit and fraud risk management activities
and accomplishments, including the internal audit organizational
updates.
With regard to financial reporting and controls, the Audit Committee,
together with PLDT Finance officers and SGV & Co., conducted a
review of PLDT’s audited financial statements for 2011 prepared in
accordance with PFRS and IFRS, and the final results and report
of sgV & co. on its integrated audit of 2011 PFRs and iFRs
financial statements and ICFR. The Audit Committee reviewed and
approved the PLDT Group’s 2011 Annual Report on Form 17-A
and Form 20-F for Philippine and US SEC filing, respectively. It also
reviewed and discussed with Finance officers, PLDT’s unaudited
consolidated financial results and reports for the three months
ended march 31, 2012, the six months ended June 30, 2012 and
the nine months ended september 30, 2012.
With regard to governance, general internal controls and risk
management, the audit committee reviewed and approved the
2011 Pldt audit committee Report for inclusion in the annual
Report and conducted a self-evaluation of the audit committee’s
performance for the year 2011. it reviewed and discussed
with the corporate secretary, chief legal counsel and chief
Governance Officer the status of the Company’s compliance
with regulations and applicable laws and updates on significant
legal matters, the periodic status reports on whistleblowing
complaints received by Corporate Governance Office (CGO), as
well as cgo’s report on the statistics and effectiveness of, and
identified system improvements to the existing Whistleblowing
Policy and Procedure. the audit committee also discussed with
the President and ceo the Pldt group’s top enterprise risks
from the ceo’s perspective, and the corresponding mitigation
measures to address these key enterprise risks, and reviewed
the Group Enterprise Risk Management Officer’s periodic status
reports on the Pldt group’s enterprise risk management
activities.
discussions with relevant Pldt business and operational unit
heads were also conducted on the following matters:
• updates on Information Technology (IT) Group transformation
and directions;
• major hR-related risks and the corresponding measures
taken to address such risks;
• updates on service delivery process, quality of service, and
actions taken on outstanding audit issues;
• updates on relevant tax rulings; and
• updates on results of customer experience surveys and
related activities.
the audit committee likewise reviewed and approved the Pldt
Disclosure on SEC Form 17-C in connection with the Philippine
sec memorandum no. 4-2012, “sec guidelines
in the
Performance assessment of audit committees”, reviewed and
resolved to retain the existing Pldt audit committee charter,
reviewed and approved the Pldt audit committee’s semi-
annual reports of activities during 2012 and issued periodic
written updates to the Audit Committee of First Pacific regarding
significant items discussed during PLDT Audit Committee
meetings in 2012.
the audit committee had nine meetings for the year 2012 and
a total of Php4.20 million was paid as per diem to its members
and advisors who attended the meetings6.
6 Php75,000 for each meeting attended.
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AuDIT COMMITTEE 2012 MEETINGS
ATTENDANCE PERFORMANCE
Jan
30
Mar
5
Mar
22
May
7
Jun
14
Aug
6
Sept
25
Nov
6
Dec
4
Totals
ac members
Bienvenido F. Nebres
(Chairman)*1
Pedro E. Roxas*
Alfred V. Ty*
ac advisors
Corazon S. Dela Paz-
Bernardo2
Roberto R. Romulo
James L. Go
Setsuya Kimura
x
x
* Independent Director.
1 Resigned effective September 25, 2012.
2 Member with accounting and financial expertise.
x
—
—
x
x
6/7
9/9
7/9
9/9
7/9
9/9
9/9
Governance and Nomination Committee
the gnc oversees the development and implementation
of corporate governance principles and policies as part of
its governance function. it also provides assistance to the
Board in making an assessment of the Board’s effectiveness
in the process of replacing or appointing new members of
the Board and/or Board Committees, and in developing and
implementing the Board’s performance evaluation process.
as part of its nomination function, it reviews and evaluates the
qualifications of the persons nominated to the Board as well
as those nominated to other positions requiring appointment
by the Board. In addition to this, it identifies persons potentially
qualified to become members of the Board and/or the Board
committees.
The GNC is composed of five voting members, three of whom
are independent directors and the other two are non-executive
directors7. the gnc also has three non-voting members
composed of an independent member of the advisory
committee, the human Resources group head and the chief
Governance Officer of the Company. The Charter of the GNC
may be accessed and downloaded from the Pldt website
through the following link:
http://www.pldt.com.ph/about/management/Documents/
Governance%20and%20Nomination%20Committee%20
Charter.pdf
In 2012, the GNC screened and identified nominees for
election as directors/independent directors at the PLDT annual
stockholders’ meeting. It also reviewed the list and qualifications
of PLDT officers for re-appointment at the organizational
meeting of the Board of directors.
consolidated results of the Board assessment, along with the
recommended actions, the gnc self-assessment results and
Report on activities for 2011 were submitted to and noted by
the Board.
the gnc also reviewed and monitored
the status of
whistleblowing reports, disclosures to regulators, updates on
regulatory developments and other reports of the cgo. it had
an opportunity to hear from the corporate governance officers
from PLDT subsidiaries and affiliates about the adoption and
implementation of, and innovations in, corporate governance
practices by these companies. the gnc also received and
discussed reports pertaining to results of corporate governance
ratings from domestic and international rating agencies.
the gnc guided the development of Pldt’s guidelines on
Related Party transactions which was issued on may 24, 2012
as Administrative Order No. 2137-12. The GNC also discussed
Pldt’s general Practice (gP) no. gP-12-002 on stakeholder
engagement that was issued on may 16, 2012, which
embodies the company’s modes of engagement with various
stakeholders, including customers, shareholders/investment
community, employees, suppliers, government/regulators,
media, industry and communities. the gP on stakeholder
engagement is in line with Pldt’s commitment to deal with
stakeholders in accordance with its core business principles of
integrity, transparency, fairness, and accountability.
Finally, the gnc continues to support efforts at ethical culture
building in the company and it took a direct hand in the
determination of content and selection of the speaker for the
CG Enhancement Sessions for Directors and Officers for 2012,
and selecting themes and designs for internal communication
materials for 2013.
in the performance of its governance function, the gnc
discussed and evaluated the results of the Board assessment
for 2011 and the GNC Evaluation/Self-Assessment. The
the gnc held three meetings in 2012 and a total of
Php1.65 million was paid as per diem to its members who
attended the meetings8.
7 With the resignation of Rev. Fr. Bienvenido F. Nebres, S.J., on September 25, 2012, the GNC’s voting members temporarily consist of two independent
directors and two non-executive directors.
8 Php 75,000 per meeting attended.
2012 annUal RePoRt
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GOVERNANCE AND NOMINATION COMMITTEE 2012 MEETINGS
ATTENDANCE PERFORMANCE
EXECuTIVE COMPENSATION COMMITTEE 2012 MEETINGS
ATTENDANCE PERFORMANCE
Mar
22
July
27
Oct
24
Totals
Mar
5
Oct
3
Totals
voting members
Manuel V. Pangilinan
(Chairman)
Pedro E. Roxas*
Alfred V. Ty*
x
Bienvenido F. Nebres, S.J.*1
-
Setsuya Kimura
non-voting members
Artemio V. Panganiban
Menardo G. Jimenez, Jr.
Ma. Lourdes C. Rausa-Chan
* Independent Director.
* Resigned effective September 25, 2012.
3/3
3/3
2/3
2/2
3/3
3/3
3/3
3/3
voting members
Manuel V. Pangilinan
(Chairman)
Bienvenido F. Nebres, S.J.*1
-
Pedro E. Roxas*
Alfred V. Ty*
Setsuya Kimura
non-voting member
Menardo G. Jimenez, Jr.
* Independent Director.
1 Resigned effective September 25, 2012.
2/2
1/1
2/2
2/2
2/2
2/2
Executive Compensation Committee
Technology Strategy Committee
the tsc assists the Board in reviewing and approving the
strategic vision for the role of technology in the company’s
overall business strategy, fulfilling its oversight responsibilities
for the company’s effective execution of its technology-related
strategies, and ensuring the optimized use and contribution of
technology to the company’s strategic objectives and growth
targets. the tsc is composed of six voting members and one
non-voting member. Under the charter of the tsc, at least one
member of the tsc must have at least a general knowledge or
understanding of the technologies relevant to the company’s
line of business. a copy of the charter of the tsc may be
viewed and downloaded from the Pldt website through the
following link:
http://www.pldt.com.ph/about/management/Documents/
Technology%20Strategy%20Committee%20Charter.pdf
The TSC had two meetings in 2012. The first meeting was on
prospects and plans regarding 3g and long-term evolution
(or 4g) technologies, over the top Providers (ottP), location-
based services and cloud computing. in the second meeting,
the tsc discussed updates on the Pldt technology Roadmap
and the Pldt group’s cloud deployment. the gains from
synergies with digitel and sun cellular were also discussed in
the second meeting. a total of Php1.05 million was given as per
diem to its members who attended the meetings11.
the ecc provides guidance and assistance to the Board with
respect to the development of a compensation philosophy
consistent with the culture, strategy and control environment
of the company. it also oversees the development and
administration of the company’s executive compensation
programs and assists the Board in the areas of performance
the professional
evaluation, succession planning and
development programs for officers. The ECC is composed of
five voting members, three of whom are independent directors,
and the other two are non-executive directors9. the ecc also
has one non-voting member, who is the head of the human
Resources group of the company. the charter of the ecc may
be viewed and downloaded from the Pldt website through the
following link:
http://www.pldt.com.ph/about/management/Documents/
Executive%20Compensation%20Committee%20Charter.pdf
in 2012, the ecc discussed and approved the discretionary
pay for officers and executives for 2011 performance (in lieu of
the 2011 variable pay), the 2012 variable pay targets and the
corresponding variable pay payout levels, and the cancellation of
the 2010-2012 long-term incentive Plan (ltiP). a discretionary
payout was instead approved and paid in 2012. the ecc also
discussed and approved the continuation of the 2010-2012
ltiP of Pldt subsidiary sPi and to revisit the 2010-2012 ltiP
of ePldt and Pldt global corporation (Pldt global). Finally,
the ecc discussed and approved the presentation of the new
2012-2014 ltiP to the Board for the latter’s approval and the
2012 merit increase for officers and executives.
the ecc held two meetings
in 2012 and a total of
Php0.83 million was paid as per diem to its members who
attended the said meetings10.
9 With the resignation of Rev. Fr. Bienvenido F. Nebres, S.J. on September 25, 2012, the ECC’s voting members temporarily consist of two independent
directors and two non-executive directors.
10 Php75,000 per meeting attended.
11 Php75,000 per meeting attended.
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TECHNOLOGY STRATEGY COMMITTEE 2012 MEETINGS
ATTENDANCE PERFORMANCE
Aug
6
Oct
23
Totals
voting members
Manuel V. Pangilinan
(Chairman)
Napoleon L. Nazareno
Ray C. Espinosa
Setsuya Kimura
Oscar S. Reyes
James L. Go
non-voting member
Orlando B. Vea
2/2
2/2
2/2
2/2
2/2
2/2
2/2
executive implementation
our Board exercises oversight on management in accordance
with the standards set forth in our cg manual.
President and Chief Executive Officer
the President and ceo provides leadership for management
in developing and implementing business strategies, plans
and budgets. he ensures that the business and affairs of the
company are managed in a sound and prudent manner and
that operational, financial and internal controls are adequate
and effective to ensure reliability and integrity of financial
and operational information, effectiveness and efficiency of
operations, safeguarding of assets and compliance with laws,
rules, regulations and contracts. the President and ceo,
with the assistance of the rest of Pldt’s management, also
has the responsibility to provide the Board with a balanced,
understandable and accurate account of the company’s
performance, financial condition, results of operations and
prospects, on a regular basis.
Internal Audit Organization
Pldt has an internal audit organization that determines whether
our structure of risk management, control and governance
processes, as designed and represented by management, are
adequate and functioning to ensure that:
1. Risks are appropriately identified, managed and/or reported;
2. Significant financial, managerial and operating information
are accurate, reliable and timely;
3. employees’ actions are in compliance with policies, standards,
procedures, and applicable laws and regulations;
4. Resources are acquired economically, used efficiently and
adequately protected;
5. Programs, plans and objectives are achieved;
6. Quality and continuous improvement are fostered in our
control processes; and
7. Significant legislative or regulatory issues impacting us are
recognized and addressed appropriately.
to provide for the independence of the internal audit organization,
its personnel report to the head of the internal audit organization,
being the Chief Audit Officer/Internal Audit Head, who reports
functionally to the audit committee and administratively to the
President and CEO. The Chief Audit Officer is accountable to
management and the audit committee in the discharge of his
duties and is required to:
1. Provide annually an assessment on the adequacy and
effectiveness of our processes for controlling our activities
and managing our risks;
2. Report significant issues related to the processes of
controlling our activities, including potential improvements
to those processes, and provide information concerning
such issues; and
3. Periodically provide information on the status and results
of the annual internal audit plan and the sufficiency of our
internal audit organization’s resources.
the company’s internal audit organization has a charter
approved by the audit committee that complies with the
international standards for the Professional Practice of internal
auditing of the institute of internal auditors, in the discharge of
its scope of work and responsibilities.
External Audit
the external auditor is appointed by the audit committee which
reviews its qualifications, performance and independence. To
ensure objectivity in the performance of its duties, the external
auditor is subject to the rules on rotation and change (every
five years); general prohibitions on hiring of staff of the external
auditor; and full and appropriate disclosure and prior approval
by the audit committee of all audit and non-audit services and
related fees for such services. approval of non-audit work by
the external auditor is principally tested against the standard of
whether such work will conflict with its role as an independent
auditor or would compromise its objectivity or independence
as such.
Enterprise Risk Management
also working in coordination with our internal audit organization
and audit committee is the Pldt enterprise Risk management
department. the complex and dynamic business environment
that the Pldt group operates gives rise to a variety of risks.
the enterprise Risk management department is in charge of
managing an integrated risk management program with the
goal of identifying, analyzing and managing the Pldt group’s
risks to an acceptable level, so as to enhance opportunities,
reduce threats, and thus sustain competitive advantage.
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2012 annUal RePoRt
33
Chief Governance Officer
Corporate Governance Office
the cg compliance system established in the cg manual includes
the designation by the Board of a Chief Governance Officer who
reports to the chairman of the Board and the gnc. the primary
responsibilities of the Chief Governance Officer include monitoring
compliance with the provisions and requirements of corporate
governance laws, rules and regulations, reporting violations
and recommending the imposition of disciplinary actions, and
adopting measures to prevent the repetition of such violations.
In addition, the Chief Governance Officer assists the Board and
the gnc in the performance of their governance functions,
including their duties to oversee the formulation or review and
implementation of the corporate governance structure and
policies of the company, the establishment of an evaluation
system to verify and measure compliance with the cg manual
in relation to related laws, rules and regulations, and to
oversee the conduct of a self-assessment of the performance
and effectiveness of the Board, the Board committees, and
individual Board members in carrying out their functions.
the cgo is responsible for the continuing development,
drafting,
issuance and review of appropriate corporate
governance policies, attending to reports received through
the whistleblowing facility, addressing queries and providing
opinions or guidance on corporate governance matters
to operating units,
to
ensure compliance with corporate governance policies,
and maintaining a corporate governance education and
communication program that sees to the development of
the proper knowledge, skills, attitudes and habits that would
promote voluntary observance of corporate governance policies.
initiating enforcement actions
the Pldt cg manual is the basis for the establishment of and
provides operational guidance to all Pldt corporate governance
structures as shown in the chart below.
Shareholders
Election
Report
Accountability
Board of Directors
Report
Appointment
External
Auditor
Report
Appointment
Committee Charter
Designation
Report
Assurance
Appointment
Board Committees
Audit
Committee
Executive
Compensation
Committee
Technology
Strategy
Committee
Governance &
Nomination
Committee
Oversight
Guidance
Report
Report
Oversight
Guidance
Oversight
Guidance
Report
Information
Internal
Audit
ERM
Department
Corporate
Governance
Office
Audit
Report
Guidance
Guidance
Oversight
Annual Audit
CEO
Management
Appointment
Oversight
Report
Accountability
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Our Policies, Processes
and Practices
if our cg manual provides the framework and structure of
our corporate governance program, it is our code of ethics
that animates the way we relate to our shareholders and
stakeholders. it is through the code of ethics that Pldt
commits itself to observe the values of accountability, integrity,
fairness and transparency and aims to promote a culture of
good corporate governance. it provides standards that govern
and guide all business relationships of Pldt, its directors,
officers and employees.
as part of Board oversight, the company’s corporate governance
policies and their effectiveness are reviewed every two years
to ensure that they continue to be compliant, appropriate and
effective. the review of the code of ethics was conducted and
reported to the gnc in october 2012.
Key standards articulated in the
Pldt Code of ethics
• Compliance with applicable laws, rules and regulations;
• Ethical handling of conflicts of interest, corporate
opportunities and confidential information;
• Protection and proper use of company assets;
• Fair dealing with employees, customers, service providers,
suppliers and competitors;
• Compliance with reporting and disclosure obligations to
the relevant regulators and to investors;
• Compliance with disclosure and financial reporting
controls and procedures;
• Assessment and management of risks involved in
business endeavors; and
• Adoption of international best practices of good corporate
governance in the conduct of the Company’s business.
Other Policies
the company also has other policies adopted by the Board to
provide both general and specific guidelines that complement
the code of ethics.
Conflict of Interest Policy (approved on October 24, 2005) —
this policy aims to ensure that work-related actions of Pldt’s
directors, officers, employees and consultants are based on
sound business principles and judgment devoid of bias or
partiality. it enjoins all employees to be aware of the possibility
of such bias and partiality in dealings with various entities or
individuals in the course of or in relation to their work. the policy
likewise mandates that employees who find themselves in a
possible conflict of interest situation should promptly disclose
the matter to the relevant authorities. if warranted, the employee
concerned should also obtain appropriate approvals and inhibit
himself from any action, transaction or decision involving an
existing or potential conflict of interest.
Policy on Gifts, Entertainment and Sponsored Travel (approved
on January 31, 2006) — this policy provides safeguards so
that the custom of giving gifts is handled in accordance with
the values of accountability, integrity, fairness and transparency.
it aims to prevent the occurrence of situations or actions that
could significantly affect objective, independent or effective
performance of an employee’s duties. Specifically, it prohibits
the solicitation of gifts, sponsored travel, and entertainment
from third parties. Receipt and acceptance of gifts voluntarily
given by such third parties are handled according to this policy
as well.
Supplier/Contractor Relations Policy (approved on January 31,
2006) — this policy seeks to ensure that the company upholds
the highest professional standards in business practices and
ethics in its dealings with suppliers and contractors in the
procurement of goods and services. the policy also seeks to
maintain Pldt’s reputation for equal opportunity and honest
3_PLDTar12 _rev.indd 35
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2012 annUal RePoRt
35
treatment of suppliers in all business transactions. it establishes
clear rules for an arm’s-length transactions and fair treatment of
prospective and existing suppliers with the objective of always
obtaining the best value for the Company. The policy specifically
adopts the processes of vendor accreditation and competitive
bidding as the general rule and established practices to ensure
that contracts are awarded only to qualified and duly-accredited
suppliers and vendors who offer the best value for money for
Pldt’s requirements.
Policy on Employee Disclosure on Violations of the Corporate
Governance Rules, Questionable Accounting or Auditing
Matters, and Offenses covered by PLDT’s Table of Penalties
(or the Expanded Whistleblowing Policy, approved on May 9,
2006) — this policy provides guidelines on handling employee
disclosure or complaints of violation of rules pertaining to the
aforestated matters, protects whistleblowers from retaliation
and ensures confidentiality and fairness in the handling of a
disclosure or complaint.
the Policy on gifts, entertainment and sponsored travel,
the Supplier/Contractor Relations Policy, and the Expanded
Whistleblowing Policy, including their implementation, were
reviewed and the results thereof reported to the gnc in 2011.
detailed implementing guidelines are likewise issued for the
said policies to ensure their wide observance. all these policies
and rules (cg Rules) are periodically reviewed to ensure that
they are appropriate for Pldt, keep pace with comparable and
applicable global best practices, and are compliant with the
requirements of the Philippine sec and U.s. sec, nyse and
hKse corporate governance rules, as may be appropriate and
applicable.
to access the code of ethics, the cg manual or information
on how Pldt’s corporate governance practices and those
required of U.s. listed companies under nyse section 303a.11
differ, please refer to:
http://www.pldt.com.ph/governance/about/Documents/
27623c20007849698da4df57179ec70dPLDT_Code_of_
Business_Conduct_and_Ethics.pdf
http://www.pldt.com.ph/governance/about/Documents/223
36f71c88c495793d15575c2addffcpldtcorpgov_manual.pdf
http://www.pldt.com.ph/governance/about/Documents/
f7933d17962d4b2c942e50ba4980f21bpldtdisclosure.pdf
Pldt’s subsidiaries and their respective subsidiaries have also
adopted corporate governance rules and policies similar in
substance and form to Pldt’s cg Rules and suited to their
particular business environments and contexts, as well as
appointed their respective corporate governance officers.
Pursuant to the Conflict of Interest Policy, PLDT officers,
executives and employees are required to submit Conflict of
Interest Disclosures. If a transaction is affected by conflict of
interest, it is subject to approval by the appropriate approving
authorities and the conflicted director, officer, executive or
employee is prohibited from participating in any activity related to
the said transaction. Pldt’s suppliers, vendors and contractors
are also required to make prompt disclosures with respect to
relationships and affiliations that they or their personnel may
have with respect to PLDT directors, officers, executives and
employees.
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facilitates
Pldt’s expanded Whistleblowing Policy
the
anonymous reporting of violations of cg Rules, accounting and
auditing rules and regulations or the Pldt Personnel manual.
Pldt maintains a Whistleblowing hotline and other reporting
facilities, such as a dedicated electronic mailbox, post office
box, and facsimile transmission system. all employees and
stakeholders who come forward in good faith to report any
of the violations mentioned above or any act that may be
considered as contrary to the company’s values may submit
a complaint or disclosure on such violations to the cgo.
anonymous complaints are allowed and are duly processed.
Upon receipt of a report, complaint or disclosure by the cgo,
a preliminary evaluation is conducted to determine the veracity
and plausibility of the allegations contained in the complaint or
report, as well as determine the appropriate investigating unit to
which the case shall be assigned for further action. the cgo
monitors the developments in the cases reported and ensures
appropriate reporting to the audit committee, the gnc, or any
other relevant committee, body or authority on the results of
the investigations and the prompt referrals of findings to the
units concerned. in all processes and activities related to a
whistleblowing complaint or disclosure, utmost confidentiality is
observed in order to ensure the integrity of the process and/or
protect the parties, employees or offices who may be involved.
in
in line with all of these, Pldt has incorporated corporate
governance standards
the performance evaluation of
employees and has included violations of cg Rules as cause
for disqualification in being awarded incentives and rewards in
its Policy on Employee Qualification for Incentives and Rewards,
including the ltiP.
to make sure that relations between the company and its
business partners are imbued with shared standards on good
corporate governance, the company has developed written
corporate governance guidelines for suppliers and contractors
to which the company’s suppliers and contractors are expected
to consent in writing, thereby ensuring that they understand and
accept these standards as indispensable in doing business with
PLDT. The Company also conducts suppliers’/contractors’
briefings and communicates
its business partners,
including suppliers, the company’s commitment to, as well as
expectations on, good corporate governance.
to
as part of its education and communication program, Pldt
provides continuous training for its Board, senior management
and employees, which includes an annual enhancement
session conducted by internationally-known experts to share
their insights and interact with Pldt’s Board and senior
management. Pldt has organized and conducted six (6)
annual enhancement sessions since 2007.
in november 2012, dr. thomas donaldson, the mark o.
Winkelman Professor and the director of the Zicklin center
for Business ethics Research, the Wharton school University
of Pennsylvania, spoke before the Pldt Board of directors,
as well as other directors from First Pacific affiliates in the
Philippines. dr. donaldson’s session, entitled Navigating the
New World of Business discussed how companies operate in
these turbulent times and navigate issues of reputational risk,
governance and integrity. he spoke about major failures in the
areas of governance and risk management and the dangerous
patterns of rewards and cultural weakness. he emphasized
that compliance is important, but that it should be augmented
by right leadership, proper systems and a culture guided by
the right values, such as integrity, responsibility and fairness.
dr. donaldson conducted a similar session for Pldt’s senior
management on november 20, 2012. also, present at the
session were senior executives from the other First Pacific
affiliate companies in the Philippines.
Pldt not only trains to get the right “tone at the top” but also
applies efforts to “shape the middle”. Pldt regularly provides
corporate governance training for its middle management. in
2012, a special session for its executives was conducted by mr.
Keith darcy, executive director of the ethics and compliance
Officer Association (ECOA) based in Waltham, Massachusetts,
Usa. mr. darcy discussed Corporate Responsibility in the
Changing Global Landscape. he emphasized that in the
changing global landscape, companies that have ethical,
self-regulating cultures will be able to withstand the many
upheavals that business will face. close to 400 delegates from
Pldt, smart, ePldt, sPi global, Pldt global, digitel, sun,
meralco, mPic, asian hospital and medical center, maynilad,
mediaQuest, mediascape and tV5 were present at the session.
in addition, newly-promoted or hired executives are required to
undergo a half-day workshop on ethical decision making as
part of their competency development as managers. the highly
interactive course provides personnel in the middle manager
category an opportunity to discuss and develop approaches to
ethical dilemmas that confront them at the workplace.
to strengthen middle management’s management and
implementation of internal controls in Pldt, a workshop entitled
Managing from a Position of Control was developed and
launched in 2012. the course was developed through the joint
efforts of the internal audit, corporate governance, finance and
human resource offices of PLDT. The course seeks to empower
concerned personnel
in understanding, observing and
implementing internal controls within their respective spheres of
authority. it provides detailed discussions on the rationale for
internal controls, responsibilities of personnel and procedures
for observance. a pilot course and one regular run of the
workshop were conducted in 2012. other Pldt executives and
key supervisory personnel will take the course in 2013.
Pldt requires all newly-hired employees and executives to
undergo a corporate governance orientation.
in addition to face-to-face training, Pldt has an online training
modules for its employees. Pldt executives with the rank
of manager, senior manager and assistant vice president are
required to access and complete an online training course on
the Pldt expanded Whistleblowing Policy. supervisory and
rank-and-file employees, on the other hand, are required to take
and complete a module on the PLDT Conflict of Interest Policy.
3_PLDTar12 _rev.indd 37
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2012 annUal RePoRt
37
education and training is supplemented by the production and
dissemination of relevant corporate governance communication
materials, including thematic posters, calendars and newsletters.
Directors and certain officers and executives of PLDT are also
provided with weekly corporate governance newsbriefs, which
contain summaries of news articles from global online sources.
the Board of directors is also provided with CG Updates of
articles on relevant topics written by noted authors and/or
authorities. the company also issues periodic advisories on
corporate governance.
Our stakeholders
the structures, processes, programs and principles set out in
the cg manual, code of ethics and cg Rules are meaningless
unless they find expression in our relationships with our various
stakeholders. Pldt remains committed to establishing and
maintaining a corporate culture anchored on performance and
responsibility in fulfilling obligations to our stakeholders. PLDT
knows that the welfare of its stakeholders is a critical indicator
of whether or not a company is truly serious about the way it
conducts its business and observes its core values. Pldt
understands that proper governance should create a company
that has a well-founded and proven reputation for being a safe
haven for investments, a trustworthy business partner, a fair and
concerned employer and a responsible corporate citizen.
Investors
Pursuant to our cg manual, it is the duty of the Board to
promote and uphold stockholders’ rights such as the right to
vote, pre-emptive right, the right to inspect corporate books
and records, right to timely receive relevant information, right
to dividends, and the appraisal right. it is likewise, the Board’s
function to explore and implement steps to reduce excessive or
unnecessary costs that impede stockholders’ participation and
to act with transparency and fairness at the annual and special
stockholders’ meetings. the Board shall likewise ensure that
the company remains faithful to its undertaking to make timely
disclosures of material information and transactions that could
potentially affect the market price of the company’s shares
and such other information which are required to be disclosed
pursuant to the securities Regulation code (sRc) and its
implementing Rules and Regulations including, without limitation,
earnings results, acquisition or disposal of significant assets, off
balance-sheet transactions, related party transactions, Board
membership changes, shareholdings of Directors and Officers
and any changes thereto, and remuneration of directors and
Officers.
The Company files with the Philippine SEC and the PSE all
written disclosures or reports on material information and
transactions in accordance with the sRc and its implementing
Rules and Regulations and the established procedures of the
Philippine sec and the Pse regarding such matters.
shareholders who wish to raise matters or concerns relating to
the business of the company may elevate such matters to the
corporate secretary, the investor relations officer, concerned
units of Pldt’s management or the Board of directors.
PLDT’s Code of Ethics prohibits directors, officers and employees
from dealing in the company’s shares when in possession
of material non-public information about and involving the
Company. Directors, officers and employees are enjoined to
report to the company their dealings in the company’s shares,
regardless of whether such dealings were effected during or
outside the blackout period, within three trading days from
the date of the transaction, to enable the filing of the required
disclosures to the Philippine sec and the Pse. during blackout
periods, dealing in Company shares by directors, officers or
employees is not allowed and in any exceptional case, prior
notice to the company should be made of any such dealing in
company shares, in accordance with the company’s policy on
Blackout Period/Restriction on Trading of Shares.
in addition, the company’s guidelines on the Proper handling
of Related Party transactions provides the procedures for the
review, approval and disclosure of related party transactions
in order to ensure that these, if any, are fair, on an arm’s-
length terms, and in the best interest of the company and its
shareholders, as a whole. material related party transactions
are reviewed by the audit committee and subject to approval
by the Board or, as applicable, the shareholders.
PLDT takes pride in its multi-awarded investor relations office.
Pldt has also been recognized several times as the company
most committed to a strong dividend policy. it is an encouraging
proof that sound corporate governance, concern for investors/
shareholders, and profitability go hand-in-hand.
Customers
it is Pldt’s privilege to serve a broad range of customers from
residential customers, smes, corporate customers covering
large local and international companies, organizations and
government. Pldt continually strives to satisfy its customers’
expectations and concerns regarding quality of service, pricing,
application process, service provisioning process, repair and
restoration service and the billing process. We continuously
engage with our customers through various touchpoints with
the end in view of knowing and understanding our customers’
communication products and service needs, promptly
addressing their concerns and identifying areas where we could
further enhance customer experience.
Employees
Pldt recognizes the myriad concerns of its employees. Pldt
respects the rights of its personnel, chief among these are the
right to self-organization, safe working conditions, rest and
leisure, and work-life balance. it also provides opportunities
for skills, leadership and competency training as well as career
development. Pldt provides adequate opportunity for career
38
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3_PLDTar12 _rev.indd 38
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and intellectual property rights. the company’s purchases, as
a general rule, are made on the basis of competitive bidding
of accredited and qualified suppliers, in accordance with the
aforementioned policy.
Creditors
in accordance with our code of ethics, we protect the rights
of our creditors by publicly disclosing all material information,
such as earnings results and risk exposures relating to loan
covenants. our disclosure controls and procedures also include
periodic reports to our creditors such as our latest certified
Financial Statements, No Default Certification, and Certification
on compliance with financial ratio limits.
Environment
Pldt is committed to do its part in addressing the pressing
need to preserve and protect our environment. as such, Pldt
ensures compliance with the rules and regulations from local
government regulatory offices such as the Department of
environment and natural Resources’ (denR) environmental
management Bureau, the laguna lake development authority
and other similar agencies and offices. Furthermore, projects
to reduce waste and the company’s carbon footprint are also
being implemented. the company regularly monitors relevant
global Reporting initiative (gRi) indicators such as direct
energy consumption, energy saved, initiatives to reduce energy
consumption, total water withdrawn by source, direct and
indirect greenhouse gasses emission by weight, total weight of
waste by type and disposal method, and total environmental
expenditures and investment.
advancement on a merit-based system. compensation and
incentives are likewise determined on the basis of performance
and accomplishment. dedicated staff and facilities are made
available for the training and development programs of the
company. the company organizes programs that support
the well-being of employees, allows them to participate in
Pldt’s corporate social Responsibility (csR) activities and
obtains their feedback on company concerns. organization
and employee opinion survey is conducted at regular intervals
to gauge employee engagement as well as feel the pulse of
Pldt employees across the organization at different levels and
positions concerning topics and issues which are prioritized
and addressed in the various people programs of the company.
in accordance with the company’s Personnel manual, the
Company provides medical and dental benefits for our
employees, which include hospitalization, doctor consultation,
medicines and laboratory tests. the company monitors and
submits reports on employee health and safety in accordance
with applicable regulations.
Communities
Pldt operates all over the Philippines and inevitably relates
to local residents, non-governmental organizations and other
sectors in the communities where we do business. We are
aware that these communities are concerned about Pldt’s
products and services and the impact of its operations on such
communities. no less than our cg manual mandates that Pldt,
through the Board of directors, shall ensure that there exists a
program for communicating with the sectors in the communities
where the company operates or those who are affected by its
operations.
as a telecommunications service provider, Pldt serves
communities and the people that live in them by providing
products and services that offer various options for people to
connect with each other. as a corporation, Pldt creates wider
opportunities for employment, entrepreneurship and greater
well-being. as a corporate citizen, Pldt actively engages
with the communities, including the sectors directly affected
by its operations, through csR projects in education, health,
community, environment,
livelihood development, youth
development and sports, and disaster relief operations.
Suppliers
PLDT aspires to maintain mutually beneficial relationships only
with like-principled suppliers that uphold Pldt’s core values
of accountability, integrity, fairness, and transparency in their
own businesses. Pldt has over 1,500 active suppliers which
serve the requirements of the Pldt group, ranging from
capital expenditures to operating expenditure items, as well as
services. The Company’s Supplier/Contractor Relations Policy
provides for the general principles to be followed in vendor
selection. suppliers are required to undergo an accreditation
process before they engage in business with Pldt. among
the criteria for accreditation are financial capability, technical
capability, compliance with applicable laws, including those
pertaining to industrial relations, environment, health and safety
3_PLDTar12 _rev.indd 39
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2012 annUal RePoRt
39
Advocacy and Networking
Pldt is actively engaged in the advocacy for better governance
and ethics in business. this engagement is founded in the
company’s policy against corruption and bribery as set forth
in its Code of Ethics, and further reinforced in specific policies,
such as the Policy on gifts, entertainment and sponsored travel,
supplier/contractor Relations Policy and corporate governance
guidelines for suppliers, which likewise prohibit bribery involving
third parties in business dealings with the company. these
policies are implemented through anti-corruption programs and
measures such as internal controls, training and communication,
our whistleblowing system, third party due diligence, and support
for and participation in multi-sectoral anti-corruption initiatives to
eliminate graft and corruption.
Pldt reaches out to like-minded institutions and organizations
in its advocacy efforts. the Pldt group is an active
sponsoring partner member of the ecoa based in Waltham,
massachusetts, Usa. Pldt is an active participant in the
ecoa’s annual ethics and compliance conferences12. in 2012,
PLDT and wireless subsidiary Smart, participated in the first
ecoa asian symposium13. our membership at the ecoa gives
Pldt access to its vast online library on cg and related topics,
opportunities to interact with other corporate governance and
ethics professionals around the world, and benchmark our
governance practices against those of leading companies.
locally, Pldt is a member organization of the good governance
advocates and Practitioners of the Philippines (ggaPP), an
association of corporate governance, ethics and compliance
professionals from private corporations, the public sector, the
academe and other organizations interested in advancing the
cause of good corporate governance. Pldt also participates in
the activities of the institute of corporate directors such as its
roundtable discussions and working sessions.
as a telecommunications company, Pldt is naturally interested
in connections. its job is to connect people to each other, and
now, increasingly to data and information. Pldt has learned
that to do its job means connecting the performance and results
of the present, to a future of sustained profitability and growth
that in turn, requires adherence to the highest standards and
principles of corporate governance. Pldt’s efforts at ensuring
adherence to these standards and principles means connecting
company personnel to its vision – exhibiting to each and every
person that his or her efforts, when put together with that of
the others in the company, create a synergy that builds the
Company’s future. More importantly, it means finding the nexus
between profitability and the Company’s core values – ensuring
that performance, results, and the very culture of the company
do not compromise long-term goals for quick gains in the
present. the company remains steadfast in its pursuit of these
connections as it learns its lessons, celebrates its gains and
looks forward to the challenges of the coming years.
12 The latest conference was held on October 2-5, 2012 at St. Louis Missouri, USA.
13 Held in Shanghai, China on January 17-18, 2012.
40
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3_PLDTar12 _rev.indd 40
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enterprise risk
m a n a g e m e n t
the plDt Group has
long recognized enterprise Risk
Management (eRM) as essential to the achievement of business
goals and objectives. the organization acknowledges eRM’s
role in the promotion of a comprehensive understanding of risks
and its effect on performance. this commitment to the proactive
management of existing and emerging risks is reinforced by the
Group enterprise Risk Management Department (GRMD).
The Group Enterprise Risk Management
Department
Created in 2010, the GRMD assumed all responsibilities
previously held by the eRM Committee. In accordance with
its mandate, the GRMD identified key elements needed to
successfully cultivate a risk-conscious culture within the plDt
Group.
Imperatives of Enterprise
Risk Management
Status
Involvement of the Board
of Directors
Creation of a central risk
function
Establishment of a
common definition of risk
Adoption of a standard
risk evaluation process
• The Board of Directors defines
the strategic direction of the
organization, and sets the PLDT
Group’s risk appetite in line with
the direction.
• The Board of Directors has general
oversight of risk management
activities of the Company.
• In 2010, the PLDT Group
Risk Management Philosophy
Statement was drafted and
approved to embody the Group’s
commitment to managing risk.
• In 2011, the PLDT Group Risk
Management Policy Manual was
approved. The policy aims to
help the organization integrate
risk management into strategic
planning and business processes.
The Board of Directors periodically
evaluates the effectiveness of this
policy.
• In 2010, the Board of Directors
formed the GRMD and issued a
mandate.
• A standard definition for risk has
been defined. It is continuously
cascaded throughout the
organization.
• The risk evaluation process
implemented throughout the
PLDT Group is based on the Draft
International Standard of ISO
31000 (discussed below). The
process is documented in the Risk
Management Policy Manual.
Creation of an Enterprise
Risk Management
Knowledge Warehouse
• This tool is being developed and it
shall enable sharing of information
on identified risks.
The Enterprise Risk Management Framework
and Process
the GRMD promulgates and encourages the use of an
integrated risk management framework centered on the need
to properly identify, analyze, evaluate, treat and monitor risks
that may affect the achievement of business objectives. the
eRM process implemented is based on the Draft International
Standard of ISo 31000.
T
L
u
s
n
o
c
D
n
a
E
T
a
c
n
u
M
M
o
c
i
EsTabLish ThE conTExT
T
n
E
M
s
s
E
s
s
a
k
s
R
i
iDEnTiFy Risks
anaLyzE Risks
EvaLuaTE Risks
TREaT Risks
i
w
E
v
E
R
D
n
a
R
o
T
n
o
M
i
the implementation of the eRM process ensures that high-
priority risks are well understood and effectively managed
across all functions and units within the plDt Group.
PLDT Group Top Risks
In 2012, the GRMD continued the implementation of the
organization’s standard risk management process in critical
operational units such as network, Marketing and Finance.
A risk assessment exercise was also undertaken by the
Joint executive Committee to identify and prioritize the most
important risks affecting the plDt Group in 2013. these top
risks are:
1. evolving Business Model
2. Market Dynamics
3. Regulatory and political Challenges
4. Media and Related Investments
5. Fast pace of technological Change
6. potential points of Failure (network Quality
and It Systems Reliability)
7. Vendor-related Issues
8. Hazards
9. people
10. Information Security and privacy
11. lack of new Growth Areas
the plDt Group is committed to intently pursuing measures
to ensure all these risks are effectively managed. treatment
strategies have been developed, and mitigation initiatives put in
place. Risk management activities are continuously monitored
and reviewed to ensure that critical risks are appropriately
addressed across the organization.
3_PLDTar12 _rev.indd 41
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2012 AnnuAl RepoRt
41
Board of directors
1
1
2
3
ManuEL v. PanGiLinan
66, Filipino
2
naPoLEon L. nazaREno
63, Filipino
3
hELEn y. DEE
69, Filipino
inc., sPi global holdings,
director of Pldt since november 24, 1998
and is a member of the technology strategy
committee of the Board of directors of Pldt.
he has served as President and chief executive
Offi cer of PLDT since his appointment on
February 19, 2004 and is concurrently the
President and Chief Executive Offi cer of Smart
since January 2000. he also serves as chairman
of several subsidiaries of smart including Pldt
communications and energy Ventures,
inc.
(PceV), Wolfpac mobile, inc., smart Broadband,
inc. and i-contacts corporation. his other
include digitel, digitel mobile
directorships
Phils,
inc., sPi
technologies, inc., sPi cRm, inc., mabuhay
satellite corporation, aces Philippines cellular
satellite corporation, Pldt global corporation,
ePLDT, Inc., Philweb Corporation and Rufi no
Pacifi c Tower Condominium Corporation. He is
a non-executive director of First Pacifi c Company
limited. nazareno’s business experience spans
several countries in over 39 years and his
exposure cuts across a broad range of industries,
namely, packaging, bottling, petrochemicals,
real estate and,
last 13 years,
telecommunications and information technology.
in 1981, he started a successful career in the
international fi rm Akerlund & Rausing, occupying
senior management
level positions
to
and, in 1989, became the President and chief
Executive Offi cer of Akerlund & Rausing (Phils.),
Inc. In August 1995, he moved to Metro Pacifi c
corporation where he served as President and
Chief Executive Offi cer until December 1999.
top
the
in
director of Pldt since June 18, 1986. she is
the chairperson, Vice chairperson or a director
of several companies engaged in banking,
insurance and real property businesses.
4
aTTy. Ray c. EsPinosa
57, Filipino
director of Pldt since november 24, 1998
and is a member of the technology strategy
committee of the Board of directors of Pldt.
he is the head of the Regulatory affairs and
Policies group of Pldt since march 2008. he
also serves as the President and chief executive
Offi cer of MediaQuest Holdings,
Inc., ABC
development corporation, mediascape, inc.,
nation Broadcasting corporation and other
subsidiaries of mediaQuest holdings, inc., the
Vice chairman of the Board of trustees of the
PLDT Benefi cial Trust Fund, the Vice Chairman of
Philweb corporation, a director and the general
counsel of meralco, a director and the chairman
of the audit committee of the Board of directors
of lepanto consolidated mining company and a
director of several companies engaged in public
utility, media and infrastructure businesses. atty.
espinosa served as President and chief executive
Offi cer of ePLDT from August 21, 2000 until April
15, 2010. Prior to joining Pldt, he was a partner
and member of the executive committee of the
law fi rm Sycip Salazar Hernandez & Gatmaitan
until June 2000.
director of Pldt since november 24, 1998.
he was appointed as chairman of the Pldt
Board after serving as President and ceo from
november 1998 to February 2004. he is the
chairman of the governance and nomination,
executive compensation
and technology
strategy committees of the Pldt Board of
directors. he also serves as chairman of meralco,
Smart, Metro Pacifi c Investments Corp., Landco
Pacifi c Corp., Philex Mining Corp., Manila North
tollways corp., tV5, makati medical center,
cardinal santos medical center, asian hospital,
inc., Riverside medical center, davao doctors
hospital, and our lady of lourdes hospital.
He founded First Pacifi c Company Ltd. in 1981
and served as managing director until 1999.
he was appointed as executive chairman until
June 2003, when he was named as ceo and
managing director. he also holds the position
of President commissioner of P.t. indofood
sukses makmur tbk, the largest food company
in Indonesia. Outside the First Pacifi c Group, he
is the chairman of the Board of trustees of san
Beda college, Pldt-smart Foundation, inc.,and
the Philippine Business for social Progress,
Philippine disaster Recovery Foundation, inc.
and the hongkong Bayanihan trust, a non-stock,
non-profi t foundation that provides vocational,
social and cultural activities for hongkong’s
foreign domestic helpers, Vice-chairman of the
Foundation for crime Prevention, a private sector
group organized to assist the government with
crime prevention, and a member of the Board
of trustees of caritas manila and Radio Veritas-
global Broadcasting systems, inc. he is a co-
chairman of the newly-organized Us-Philippines
Society, a non-profi t society that seeks to
broaden the relationship between the United
states and the Philippines in the areas of trade,
investment, education,
foreign and security
policies and culture.
42
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3_PLDTar12 _rev.indd 42
5/9/13 8:04 PM
Board of directors
4
7
5
JaMEs L. Go
74, Filipino
director of Pldt since november 3, 2011.
he is a member of the technology strategy
committee and advisor of the audit committee
of the Board of directors of Pldt. he is currently
the Chairman and Chief Executive Offi cer of JG
summit holdings, inc., Robinsons, inc., oriental
Petroleum and minerals corporation, Robinsons
supermarket, inc. and Robinsons handyman,
inc. he is the chairman of Universal Robina
corporation, Robinsons land corporation, Jg
summit Petrochemical corporation and Jg
Summit Olefi ns Corporation and a director of Cebu
air, inc., cFc corporation, Robinsons holdings,
inc., singapore land, ltd., marina center
holdings, inc., United industrial corporation and
hotel marina city Private limited. he is also the
President and trustee of the gokongwei Brothers
Foundation. he was the chairman, President and
Chief Executive Offi cer of Digitel Mobile and the
Vice chairman, President and chief executive
Offi cer of Digitel, until October 26, 2011.
5
8
8
6
9
6
sETsuya kiMuRa
56, Japanese
director of Pldt since July 5, 2011. he is a
member of the governance and nomination,
executive compensation and technology strategy
committees, and advisor of the audit committee
of the Board of directors of Pldt. he is the
director of network department of ntt docomo,
Inc. He also served as Regional CEO, Asia Pacifi c
of NTT Communications and President & CEO
of ntt singapore Pte ltd from 2007 to 2009,
and as President & CEO of NTT Communications
(thailand) co. ltd from 2003 to 2007. Prior to
that, he occupied various management positions
in nippon telephone and telegraph company.
7
hiDEaki ozaki
48, Japanese
director of Pldt since december 6, 2011. he is
the Vice President of Planning, global Business
of ntt communications corporation (ntt com),
a company which provides telecommunication
service and
ict services such as global
network, data centre, cloud services inside and
outside of Japan. Prior to that, he served as Vice
President of global strategy, global Business
division of ntt com since 2006 and as director
of legal and internal audit department of ntt
com from 2003 to 2006. he also served as Vice
President of sales and corporate Planning of
ntt communications (thailand) co., ltd. from
1999 to 2003 and as manager of overseas
Business Planning, global service division of
nippon telegraph and telephone corporation
from 1995 to 1999.
8
Ma. LouRDEs c. Rausa-chan
60, Filipino
director of Pldt since march 29, 2011. she
has been serving as corporate secretary,
corporate affairs and legal services head
and Chief Governance Offi cer of PLDT since
november 1998, January 1999 and march
2008, respectively. she is a director of PceV and
ePldt and also serves as corporate secretary
of PceV and ePldt and several subsidiaries of
Pldt. Prior to joining Pldt, she was the group
Vice President for Legal Affairs of Metro Pacifi c
corporation and the corporate secretary of
some of its subsidiaries.
3_PLDTar12 _rev.indd 43
5/9/13 8:06 PM
2012 annUal RePoRt
43
Board of directors
10
11
12
9
PEDRo E. Roxas
57, Filipino
10
Juan b. sanTos
74, Filipino
Director of plDt since March 1, 2001 and
qualifi ed as an independent director since 2002.
He serves as a member of the Audit, Governance
and nomination and executive Compensation
Committees of the Board of Directors of plDt.
He is the Chairman of Roxas Holdings, Inc. and
Roxas and Company, Inc., holding and investment
companies, as well as of several companies
engaged in agri-business, sugar manufacturing
and real estate development, namely, Central
Azucarera Don pedro, Inc., Central Azucarera
de la Carlota, Inc., Hawaiian philippine Sugar
Company, Roxol Bioenergy Corporation, Roxaco
land Corporation, and Fuego land Corporation.
He is also an independent director of Meralco
and BDo private Bank, a director of Brightnote
Assets Corporation, and a member of the
Board of Trustees of the PLDT Benefi cial Trust
Fund, philippine Business for Social progress
and Fundacion Santiago (where he is also the
president).
Director of plDt since January 25, 2011. He is
the Chairman of Social Security Commission/
Social Security System, a member of the Board
of Directors of Alaska Milk Corporation, First
philippine Holdings Corporation, Sun life Grepa
Financials, Inc. philex Mining Corporation and
Zuellig Group, Inc., a member of the Board of
Advisors of Coca Cola Bottlers phils., Inc. and
east-West Seeds Co., Inc., a trustee of St. luke’s
Medical Center and Ramon Magsaysay Award
Foundation, and a consultant of the Marsman-
Drysdale Group of Companies. Santos retired
as Chief Executive Offi cer of Nestle Philippines,
Inc. (“npI”) in 2003 and continued to serve
as Chairman of npI until 2005. prior to his
appointment as president and Ceo of npI, he
was Ceo of the nestle Group of Companies in
thailand and Singapore. He served as Secretary
of trade and Industry from February to July
2005 and was designated as a member of the
Governance Advisory Council, and private Sector
Representative for the public-private Sector
task Force for the Development of Globally
Competitive philippine Service Industries.
11
Tony Tan cakTionG
60, Filipino
Director of plDt since July 8, 2008. He is the
Chairman and Chief Executive Offi cer of Jollibee
Foods Corporation, a leader in the fastfood
business, which owns and operates a chain of
restaurants nationwide and abroad. He is an
independent director of First Gen Corporation, a
member of the Board of trustees of St. luke’s
Medical Center, a director of temasek Foundation
and the Chairman of Jollibee Foundation.
12
aLFRED v. Ty
45, Filipino
Independent director of plDt since June 13,
2006. He serves as a member of the Audit,
Governance and nomination and executive
Compensation Committees of the Board of
Directors of plDt. He is the Vice Chairman of
toyota Motor philippines Corporation and Gt
Capital Holdings, Inc., the president of Federal
Land, Inc.,, the Chairman of Asia Pacifi c Top
Management
International Resources Corp.
(Marco polo plaza Cebu), a director of Global
Business power Corp., the Corporate Secretary
of Metropolitan Bank and trust Company, the
Chairman of lexus Manila, Inc., a trustee of
Metrobank Foundation, Inc. and an independent
director of Digitel.
44
pHIlIppIne lonG DIStAnCe telepHone CoMpAny
3_PLDTar12 _rev.indd 44
5/9/13 10:47 PM
Board of directors
13
14
15
16
17
18
advisory board
aRTEMio v. PanGaniban*
oscaR s. REyEs
RobERTo R. RoMuLo
bEnny s. sanToso
13
14
15
16
washinGTon z. syciP
oRLanDo b. vEa
chRisToPhER h. younG
17
18
19
* Elected as Independent Director effective April 23, 2013.
19
3_PLDTar12 _rev.indd 45
5/9/13 8:10 PM
2012 annUal RePoRt
45
key officers & advisors
pl dt
offi cers &
adv isors
ERnEsTo R. aLbERTo
52, Filipino
appointed as enterprise and international and
carrier Business head in september 2011.
Prior to that, he was the customer sales and
marketing group head since February 2008.
he leads all revenue generation relationship
initiatives of the enterprise and international
and carrier Business, including product/market
development, product management, marketing,
sales and distribution, and customer relationship
management. he is the chairman, President or
director of Pldt subic telecom, inc., Pldt
clark telecom, inc., Pldt-Philcom, inc., Pldt-
inc., sBi-cruztelco,
maratel,
Bonifacio
corporation,
mabuhay satellite corporation, smart ntt
multi-media, ntt communications Phils.,
acasia and asean telecom holdings. he has
over 20 years of work experience in the areas
of corporate banking, relationship management
and business development and, prior to joining
Pldt in 2003, was a Vice President and head
of the national corporate group of citibank
n.a., manila from 1996 to may 2003. he
previously served as Vice President and head
of the Relationship management group of
citytrust Banking corporation.
communications
inc., telesat,
REnE G. baÑEz
58, Filipino
supply chain, asset Protection and management
group head. he was the chief governance
Offi cer of PLDT from October 2004 to March
3, 2008 and the support services and tax
management group head of Pldt
from
January 1999 to January 2001. he is the
President of Pacifi c Global Aviation Company.
he served as commissioner of the Philippine
Bureau of internal Revenue from February
2001 to august 2002. Prior to joining Pldt,
he was the group Vice President for tax affairs
of Metro Pacifi c Corporation for three years
until december 1998. he holds directorships in
some subsidiaries of Pldt.
JunE chERyL a. cabaL-REviLLa
39, Filipino
controller and Financial Reporting and
controllership head, is also a director and
the chief fi nancial offi cer/treasurer of ePLDT
and subsidiaries, clarktel, subictel, maratel,
Philcom and subsidiaries, digitel, mediascape,
Inc., Pacifi c Global One Aviation Company,
inc., Pilipinas global network limited, First
Pacifi c Learning Academy Foundation and
the Pldt-smart Foundation, inc. she is also
the Chief Finance Offi cer of the Philippine
disaster Recovery Foundation and
the
President of tahanan mutual Building and loan
association. Prior to joining Pldt in June
2000 as an executive trainee in the Finance
group, she was a senior associate in the
business audit and advisory group of sycip
Gorres Velayo & Co. She was the 2008 Young
achievers awardee for commerce and industry
conferred by the Philippine Institute of Certifi ed
Public accountants.
in march 2010, she
was appointed as a member of the Financial
Reporting standards council of the Philippines.
aLEJanDRo o. caEG
52, Filipino
President and Chief Executive Offi cer of
Pldt global corporation and concurrently
the Head of PLDT and Smart International &
carrier Business. he is smart’s representative
to the conexus mobile alliance (one of asia’s
largest cellular roaming alliances), where he
was also designated as its deputy chairman
since 2010. Prior to joining Pldt in 2009, he
worked in Pt smart telecom (indonesia) as
its Chief Commercial Strategy Offi cer from
July 2008 to december 2008 and as chief
Commercial Offi cer from January 2006 to June
2008. he also held various sales, marketing
and customer service-related positions
in
smart including that of group head of sales
and distribution (2003-2005), group head
of customer care and national Wireless
centers (1998-2001) and marketing head
of international gateway Facilities and local
exchange carrier (1997-1998). he also served
as President and Chief Executive Offi cer of
telecommunications distributors specialist,
inc. in 2002 and as chief operations adviser
of i-contacts corporation (smart’s call center
subsidiary) from 2001 to 2002.
11
33
3
22
2
FROM LEFT: Napoleon L. Nazareno, Ernesto R. Alberto, Ariel P. Fermin, Rene G. Bañez. Alejandro O. Caeg, Anabelle L. Chua
46
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ANABELLE L. CHUA
52, Filipino
Treasurer and Corporate Finance and Treasury
Head, concurrently holds the position of Chief
Financial Offi cer of Smart since 2006. She holds
directorships in Philippine Telecommunications
Investment Corporation, Smart and several
including
subsidiaries of PLDT and Smart
ePLDT, Digitel, SPi Global Holdings,
Inc.,
SPi Technologies, Inc., SPi CRM, Inc., Aces
Philippines Cellular Satellite Corp., PCEV,
Wolfpac Mobile, Inc., Smart Broadband, Inc.,
Connectivity Unlimited Resources, Inc., Airborne
Access Corporation, Smart Hub, Inc. and Chikka
Holdings Limited. She is a member of the Board
of Directors of Philippine Stock Exchange,
Board of Trustees of the PLDT Benefi cial Trust
Fund and PLDT-Smart Foundation. She has
over 20 years of experience in the areas of
corporate fi nance, treasury, fi nancial control
and credit risk management and was a Vice
President at Citibank, N.A. where she worked
for 10 years prior to joining PLDT in 1998.
ARIEL P. FERMIN
45, Filipino
Designated on January 1, 2012 as the Head for
Home Business segment. He has over 20 years
of solid marketing, sales and entrepreneurial
experience gained from leading Fast Moving
locally and
Consumer Group companies
globally. Prior to joining the PLDT Group,
he was the President of Greenwich Food
Corporation and Chowking Food Corporation
of the Jollibee Food Corporation from 2008
to 2011. He also served as Country Director
of Nike Philippines from 2006 to 2008 and
handled various posts in Unilever-Bestfoods
California Manufacturing Company
from
1998 to 2005 and senior executive for sales,
marketing, media and
innovation process
management.
JUN R. FLORENCIO
57, Filipino
As Internal Audit and Fraud Risk Management
Head, he handles the overall coordination
of the internal audit function of the PLDT
group of companies and in-charge of the
fraud risk management function of the PLDT
fi xed business. He has over 25 years of work
experience in the areas of external and internal
audit, revenue assurance, credit management,
information technology, fi nancial management,
and controllership. He was the Financial Controller
of Smart for four years before he joined PLDT in
April 1999 as Head of Financial Management
Sector. He held various positions in the fi nance
organization of another
telecommunications
company prior to joining Smart.
MENARDO G. JIMENEZ, JR.
50, Filipino
Human Resources Group Head and concurrently
Business Transformation Offi ce Head. He
was Revenue Team Head of the Business
Transformation Offi ce from January 2008 to
July 2010, the Retail Business Head of PLDT
from June 2004 to December 31, 2007 and,
prior to that, the Corporate Communications
and Public Affairs Head. He had a stint at
GMA Network, Inc., where he served as
head of a creative services and network
promotions. He won the fi rst CEO Excel Awards
(Communications Excellence in Organizations)
given by the International Association of Business
Communicators mainly for effectively using
communications strategies in managing the
PLDT retail business team to meet its targets
and achieve new heights in the landline
business. In 2006, his further achievements
in handling the retail business of PLDT and his
stint in Smart as offi cer-in-charge for marketing
were recognized by the Agora Awards which
chose him as its Marketing Man of the Year.
GEORGE N. LIM
60, Filipino
Network Services Assurance Head and
concurrently Network Team Head of Business
Transformation Offi ce. He has over 30 years
of work experience in telecommunications
management. He was the Network Services
Head from February 2003 to December 2007,
Network Development and Provisioning Head
from February 1999 to January 2003 and
Marketing Head from December 1993 to
February 1999. Mr. Lim holds directorships in
some subsidiaries of PLDT.
CHRISTOPHER H. YOUNG
55, British
PLDT’s Chief Financial Advisor. He worked
in PricewaterhouseCoopers in London and
Hong Kong from 1979 until 1987, at which time
he joined First Pacifi c in Hong Kong as Group
Financial Controller. He joined Metro Pacifi c
Corporation in 1995 as Finance Director,
a position he held until he joined PLDT in
November 1998.
Ray C. Espinosa, Jun R. Florencio, Menardo G. Jimenez, Jr., George N. Lim, Christopher H. Young, Ma. Lourdes C. Rausa-Chan, June Cheryl A.Cabal-Revilla
2012 ANNUAL REPORT
47
3_PLDTar12 _rev P47.indd 47
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key officers & advisors
11
FROM LEFT: Napoleon L. Nazareno, Orlando B. Vea, Anabelle L. Chua, Emmanuel Ramon C. Lorenzana, Rolando G. Peña, Rene G. Bañez, Mario G. Tamayo
11
FROM LEFT: Orlando B. Vea, Charles A. Lim, Danny Y. Yu, Ricky P. Peña, Michelle C. Curran, Richard Zawila, Susan O. Ligeralde,
Joel S. Lumalan, Carla G. Lanza
48
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key officers & advisors
Jovan C. Barac, Martin T. Backstrom, Lawrence Goh
FROM LEFT: June Cheryl A. Cabal-Revilla, Nerisse S. Ramos,
Ernesto A. Alberto
FROM LEFT: Orlando B. Vea, Ariel P. Fermin, June Cheryl A. Cabal-Revilla
FROM LEFT: Maulik R. Parekh,
Maria Cecilia C. Ampeloquio
3_PLDTar12 _rev.indd 49
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2012 annUal RePoRt
49
PLDT OFFICERS
MANUEL V. PANGILINAN
Chairman of the Board
NAPOLEON L. NAZARENO
President and Chief Executive Officer
ERNESTO R. ALBERTO
eVp, enterprise, International
and Carrier Business (eICB)
ARIEL P. FERMIN
eVp, Home Business
RENÉ G. BAÑEZ
SVp, Supply Chain, Asset protection
and Management
ALEJANDRO O. CAEG
SVp, International and Carrier Business
ANABELLE L. CHUA
SVp, Corporate Finance and treasury
Corporate treasurer
RAY C. ESPINOSA
SVP, Regulatory Affairs and Policies Office
JUN R. FLORENCIO
SVp, Internal Audit and Fraud Risk
Management
MENARDO G. JIMENEZ, JR.
SVp, Human Resources
Business Transformation Office
network team
MA. LOURDES C. RAUSA-CHAN
SVp, Corporate Affairs and legal Services
Chief Governance Officer
Corporate Secretary
KATRINA L. ABELARDE1
FVp, Small and Medium enterprise
ANNA ISABEL V. BENGZON1
FVP, Office of the Finance Group Head
ALFREDO B. CARRERA
FVp, Regulatory Strategy and Support
CESAR M. ENRIQUEZ
FVp, eICB Revenue and operations Support
JUAN VICTOR I. HERNANDEZ1
FVp, Corporate Business
FLORENTINO D. MABASA, JR.
FVp, legal Services
LEO I. POSADAS
FVp, treasury
JUNE CHERYL A. CABAL-REVILLA
FVp, Financial Reporting and Controllership
RICARDO M. SISON
FVp, Consumer Credit
and Business System Management
EMILIANO R. TANCHICO, JR.
FVp, Human Resources Management
and Development
MELISSA V. VERGEL DE DIOS1
FVp, Investor Relations
MIGUELA F. VILLANUEVA
FVp, Cost and Valuation
DANNY Y. YU
FVp, seconded to Digitel
JAVIER C. LAGDAMEO
Vp, Corporate Relationship Management A
JOSELITO S. LIMJAP1
Vp, ICt Research and Development
ALBERT MITCHEL L. LOCSIN
Vp, Corporate Relationship Management B
LUIS IGNACIO A. LOPA
Vp, enterprise Subsidiaries Account
Management
RAUL S. ALVAREZ2
Vp, Home Marketing Support
MA. CARMELA F. LUQUE1
Vp, Financial and Corporate Audit
JOSE A. APELO
Vp, operations engineering and network
Support
OLIVER CARLOS G. ODULIO
Vp, Asset protection
and Risk Management Center
LILIBETH F. PASA
Vp, HoMe Market Development and
Business Analytics
MARTIN T. RIO2
Vp, property and Facilities Management
RICARDO C. RODRIGUEZ
Vp, Compensation and Rewards planning
and Management
GENARO C. SANCHEZ
Vp, network planning and engineering
ANA MARIA A. SOTTO
VP, Business Transformation Office
JULIETA S. TAÑECA
Vp, Consumer Business System
Management
JESUS M. TAÑEDO
Vp, VisMin Customer Service District
PATRICK S. TANG
Vp, Home Voice Solutions
VICTOR Y. TRIA
Vp, Corporate Business Solutions
1 Promoted effective March 5, 2013.
2 Appointed effective October 22, 2012.
RAFAEL M. BEJAR
Vp, Medical Services
MARCO ALEJANDRO T. BORLONGAN
Vp, Customer Service operations
and Support Management
RENATO L. CASTAÑEDA
Vp, Corporate Relationship Management C
REBECCA JEANINE R. DE GUZMAN
Vp, Home Sales and Distribution
ALONA S. DINGLE
Vp, Financial Reporting
MARGARITO G. DUJALI, JR.
Vp, Home Data Solutions
GIL SAMSON D. GARCIA
Vp, Revenue and Cash Accounting
ELISA B. GESALTA
Vp, network Services project Management
MA. JOSEFINA T. GORRES
Vp, enterprise Billing and Credit
Management
MA. CRISELDA B. GUHIT
Vp, tax Management
EMERALDO L. HERNANDEZ
Vp, Core network operations
MARVEN S. JARDIEL
Vp, enterprise operations Support
and Readiness
ALEXANDER S. KIBANOFF
Vp, training, Development
and Career Management
JOSEPH NELSON M. LADABAN
Vp, Consumer Credit and Collection
Management
50
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