PLDT Inc. on Monday announced a 49 percent drop in net income in the third quarter of the year because of competition and higher spending to support its shift from text and voice to data demand.

PLDT, partly owned by Hong Kong’s First Pacific Co. Ltd. and Japan’s NTT group, reported a net income of P3.40 billion in the July to September from P6.61 billion in the same period last year.

This lowered net income by 37 percent in the January from September period to P15.87 billion from P25.34 billion in the same period last year.

Manuel Pangilinan, chairman and chief executive of PLDT and Smart Communications described the result as "annus horribilis.”

“This year has been a particularly challenging period for PLDT, as we grappled with both intense price competition and the continuing shift from voice/SMS services to data demand impacting adversely our wireless revenues; as well as internal adjustments in our senior ranks and in our processes which we are undertaking,” Pangilinan said.

"All that said, our digital transformation remains on track. We remain focused on the critical initiatives that will definitively shape our businesses to the new direction where growth is driven by data and digital innovation,” he added.

Pangilinan said the company is hoping an “annus mirabilis” in 2017.

"We have a year to work the many, many case and issues internally.” he said.

Core profit, which excludes foreign exchange gains or losses and other non-recurring income fell by 50 percent to P4.04 billion in the third quarter from P8.15 billion last year. From January to September, core profit dropped by 20 percent to P21.74 billion from P27.08 billion last year.

The consumer wireless business group posted service revenues of P55.8 billion, down 5 percent from the previous year. Mobile internet revenues jumped 37 percent while wireless broadband increased 13 percent.

But revenues from voice and SMS services declined 15 percent and 14 percent. This stemmed from a five percent cut in subscribers as competitors offered unlimited voice and SMS.

PLDT Group had a total subscriber of 65 million at end-September. Pangilinan said the company expects core net income to reach P28 billion this year, lower from the original guidance of P30 billion.

Fitch Ratings said weak revenue growth will affect profits of most Asian telcos, including the Philippines, next year as telecommunication firms still get much of their income from voice and text.

" Thai, Philippine and Indian telcos are likely to have the highest capex/revenue ratios, at around 28 percent to 30 percent, as they strengthen 4G networks in response to fast-growing data consumption and the rising importance of network quality,” Fitch said. DMS