Converge Information and Communications Technology Solution (CNVRG) Q4 2024 earnings summary

Executive summary

• Achieved high-end of all financial targets for 2024, with consolidated revenue up 14.8% to PHP 40.6 billion, driven by strong residential and enterprise growth.

• EBITDA increased 14.2% year-over-year to PHP 24.6 billion, with a 60.5% margin, exceeding guidance.

• Net income after tax rose 18.8% to PHP 10.8 billion, with a 26.6% margin.

• Subscriber base reached 2.6 million, with residential net adds up 74% year-over-year.

• Recognized by Ookla for fastest fixed network, best video, and gaming experience in the Philippines.

Financial highlights

• Residential revenues rose 13.7% to PHP 34.4 billion; enterprise revenues up 21.9% to PHP 6.2 billion.

• Gross profit increased 16% to PHP 26.2 billion; general and administrative expenses rose 33%.

• ROIC reached 18.3%, maintaining industry-leading levels.

• Q4 net income was PHP 2.6 billion, up 5% year-over-year.

• Cash and cash equivalents at year-end totaled PHP 17 billion, with total debt under PHP 30 billion and net debt-to-equity at 0.2x.

Outlook and guidance

• 2025 revenue growth targeted at 14%-16%, with EBITDA margin guidance of 61%-62%.

• ROIC expected to slightly decline to 16.5%-17.5% due to higher CapEx for growth investments.

• CapEx for 2025 projected at PHP 20-25 billion, including investments in subsea cables and data centers.

• Medium-term goal of 4 million subscribers by 2027, with continued port rollout in new regions.