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Converge reports 71% revenue growth for Q3

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Converge ICT Solutions Inc., which specializes in fiber-optic broadband services, saw a record jump in subscriptions in May, Chief Executive Officer Dennis Anthony Uy said in an e-mail interview. New activations surged 150% from a year earlier to more than 50,000, driven by retail and corporate clients like call centers equipping their employees to work remotely, he said.

Converge ICT Solutions, Inc. said its consolidated revenues for the third quarter grew 71% to P4.19 million, driven by the continued increase in residential average revenue per user (ARPU).

“Converge’s monthly residential ARPU steadily increased from P1,270 in the first half of 2020 to P1,352 in the third quarter of 2020, representing a growth of 6.5%,” it said in a disclosure to the stock exchange on Friday.

Converge said the steady growth in ARPU is a result of the increasing fiber-to-the-home subscribers as well as the growing number of customers who subscribe to the company’s premium packages.

Converge noted that its residential and enterprises businesses generated revenues of P8.41 million and P2.26 million, respectively, in the first nine months.

The company said its earnings before interest, taxes, depreciation, and amortization or EBITDA stood at P5.58 million as of September, a 74% increase from the same period last year.

Converge attributed the increase to the “higher revenue and prudent management of direct costs including our international bandwidth and leased line costs.”

It added that its consolidated EBITDA margins also improved from 50.1% last year to 52.2% this year.

Converge noted it now has 900,531 residential subscribers, a significant increase from the 454,438 residential subscribers it had in September last year.

“Installations were further accelerated and waiting times reduced by the fact that Converge today has more than double the number of installation teams as compared to before the enhanced community quarantine. In the third quarter of 2020, more than 90% of newly connected subscribers were first time fixed broadband users, highlighting the unserved and underserved state of the broadband market in the Philippines,” Converge said.

The company did not disclose figures for its net income for the third quarter nor for the nine months to September.

Shares in Converge on Friday closed 2.51% lower at P14.78 apiece. — Arjay L. Balinbin

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