Over 1.355M homes subscribe to Converge as of June 2021, SME now a growing market

MINERVA BC NEWMAN

CEBU CITY -- Converge Information and Communications Technology Solutions, Inc. (Converge), the country’s only pure-play high-speed fixed broadband operator has now reached 1,355,079 residential subscribers, 85 percent more than the figures in the 2^nd quarter of 2020, another record quarter for the Company.

According to Converge Chief Operations Officer Jesus Romero that Residential subscribers grew to 1,355,079 as of June 30, 2021 from 731,563 on June 30, 2020.  During the 2nd quarter of 2021 and based on publicly available information, Converge captured 47 percent market share of fixed broadband net adds among the three largest broadband operators in the Philippines, representing an increase in fixed broadband market share from 21 percent in June 2020 to 29 percent in June 2021.

As of June 30, 2021, Converge’s nationwide network reached more than 8.3 million homes, on track to reach its target to cover approximately 55 percent of households in the Philippines by 2025, he bared during the virtual results media briefing on August 12.

Romero said that the completion of the initial phases of the company’s domestic subsea cable network in the VisMin region in the 2^nd quarter of 2020 resulted in the activation of an end-to-end nationwide backbone reaching from northern Luzon to Mindanao.

He added that this event represented another historic milestone in the mission of Converge to bring reliable and affordable, high-speed fiber internet to millions of households in the Philippines nationwide.

As the fastest growing fixed broadband operator in the Philippines, the Converge deployed 565,848 new fiber-to-the-home (FTTH) ports during the quarter, more than twice the number of FTTH ports deployed during the same quarter the previous year, Romero shared.

Converge’s strong financial performance – Industry-leading Trifecta with 81.5 percent Year-on-Year (YOY) revenue growth from the first half of 2020 to the same period in 2021, 55.1 percent EBITDA Margin and 21.6 percent ROIC has earned the company the consolidated revenues growing by 81.5 percent  from P6,490 million in the first half of 2020 to P11,781 million in the same period in 2021, Romero bared.

“Revenues from our residential business more than doubled from P4,978 million in the first hal of 2020 to P10,212 million in the same period of 2021, driven by an 85 percent YoY growth in our subscriber base and increase of seven percent in residential average monthly revenue per user (ARPU),” he said.

Enterprise revenues on the other hand grew slightly by 3.8 percent YoY, from P1,512 million to P1,569 million mostly from the growth in the small and medium enterprise (SME) customer base.

Reflecting the high demand for fixed broadband connectivity services in the Philippines, the company estimated that 95 percent of the new subscribers in 2Q2021 were first time fixed broadband users, Romero bared.

Romero added that revenues from the enterprise business grew by 3.8 percent YoY. The successful launch of the Company’s SME product flexiBIZ earlier this year allowed it to almost double SME customer base in the 2^nd quarter of 2021 from the same period last year.  The overall enterprise customer base increased from 10,498 unique customers as of June 30, 2020 to 17,539 as of June 30, 2021.

He said that the Company is seeing signs of recovery of the SME sector in the second quarter of the year. Converge’s SME customer base grew significantly in the 2^nd quarter of 2021, arising from innovative product launch and improved sales and marketing initiatives.

After the introduction of the new SME product flexiBIZ in March 2021, SME customers grew from almost 8,800 as of March 30, 2021 to almost 13,900 by June 30, 2021. The flexiBIZ plan doubles the internet speeds during peak working hours of the day (7:00AM – 6:59PM) when the customer would need the bandwidth more.

Along with the launch, the Company also organized and participated in various online webinars to promote the product and to introduce its features to a wide variety of audience.  “We expect revenue growth from SME to be further accelerated by our expansion in the VisMin area, where we see heightened demand for reliable fiber-based connectivity services,” Romero revealed.

Converge pursued strategic, on-the-ground sales activities that increased client reach, covering commercial districts in cities and municipalities as well as covering the barangay level, he added.