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Philippines' $5bn fibre giant completes P6 billion submarine cable

Converge’s fibre backbone has already reached over 80,500 kilometres while fibre-to-the home port deployment was at 565,848 new ports during the second quarter alone.

By João Marques Lima

Founder and Editor, The Tech Capital

4 Mins

November 01, 2021 | 5:08 AM GMT

Fibre broadband operator Converge ICT Solutions Inc. (PSE: CNVRG) has completed the P6 billion domestic submarine cable project that connects the Philippines’s major islands from Luzon to the Visayas and Mindanao to its national fibre backbone.

The 1,800 kilometre subsea cable made its final landing in Coron, Palawan on Sunday, October 31.

Converge CEO and Co-founder Dennis Anthony Uy, said: “We are pleased to announce the completion of our domestic network’s primary and secondary routes which span the entirety of the country.

“Not only does this ensure availability of the service nationwide, but with the network design, we’re assured to have a resilient backbone that’s able to carry the tremendous data traffic driven by our million-plus customers.”

“More than the interconnection of the major islands, we’ve achieved a high level of resiliency in the network by ‘closing’ the loops on our primary and secondary routes.”

Converge, which currently enjoys a market capitalisation of ₱247.24 billion (US$4.89 billion), interconnected Visayas and Mindanao during Phase 1 of its domestic subsea backbone rollout, first landing in Bogo, Cebu and Cagayan De Oro.

Then in Phase 2, re-entered Visayas through Roxas City, Capiz in Panay Island and Mindanao through Buenavista, Agusan del Norte – closing the loops in its network. This is supported by 20 cable landing stations across the archipelago.

In terms of capacity, Converge makes use of 48-fiber core optical cables running on 400G and 800G technology.

Converge Chief Operations Officer Jesus C. Romero, said: “All these features on the network design and technology simply mean the connection on our network is more stable, more resilient, and less prone to failure or outages – wherever you are in the country.”

As of July 2021, the Converge’s fibre backbone has already reached over 80,500 kilometres while fibre-to-the home port deployment was at 565,848 new ports during the second quarter alone.

The network of Converge, in the first half of the year passed more than 8.3 million homes, while household coverage stood at 32.5% of all households in the Philippines.

The company last announced financial results in August, relating to the first half of the year (1H2021).

It posted consolidated revenues that grew by 81.5% from P6,490 million in 1H2020 to P11,781 million in 1H2021.

Revenues from the residential business more than doubled from P4,978 million in 1H2020 to P10,212 million in the same period of 2021, driven by an 85% YoY growth in subscriber base and increase of 7% in residential average monthly revenue per user (“ARPU”).

Enterprise revenues grew just 3.8% YoY, from P1,512 million to P1,569 million, “mostly from the growth in our small and medium enterprise (SME) customer base”.

The operator posted an EBITDA of P6,494 million in 1H2021, representing an increase of 96.0% from 1H2020. The consolidated EBITDA margin was 55.1% in 1H2021, higher than the 51.1% in the same period the year prior.

Net income after tax more than doubled from P1,259 million in 1H2020 to P3,252 million in 1H2021.

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João Marques Lima

Founder and Editor, The Tech Capital

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