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2020 Annual Report 2020 #Experiencebetter #Experiencebetter

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2020 Annual Report 2020 #Experiencebetter #Experiencebetter Reliance IT Building, 99 E. Rodriguez Jr. Ave, EXPLORE A WORLD Brgy. Ugong Pasig City +632 8667 0848 OF POSSIBILITIES: www.convergeict.com #ExperienceBetter Annual Report 2020 EXPLORE A WORLD OF POSSIBILITIES: 1 #EXPERIENCEBETTER About the Cover Contents A world of possibilities lies just right at our 2 Message from the Chairman fingertips, waiting to be explored. Seemingly infinite opportunities to be created, potentials 4 Message from the CEO to be unleashed, and relations to be nurtured are 8 Message from the President within reach. We at Converge believe that these 12 Experience Better should be within reach. Our Company was founded 12 Who We Are with the vision of empowering Filipinos, especially the unserved and underserved, to explore their 13 Vision, Mission, Values possibilities using connectivity as a tool. Through 14 History of Converge our world-class fiber optic technology, we equip 15 Organizational Structure individuals to uplift themselves. We enable 16 enterprises to pursue efficiency and growth. Fiber Internet Technology We help establish the Philippines as a globally 18 Onwards to the Future: Envisioning Connectivity for all Filipinos competitive nation. We provide Filipinos the better 20 Experience Excellence digital experience they deserve. 20 Financial Highlights The new paradigm created by the pandemic 21 Key Consolidated Financial Highlights has placed us in a crucial position to support the 22 Operational Highlights nation in further embracing and adapting to the 28 Experience Superior new—and increasingly digital—normal. Cognizant 29 Go National of this pivotal role, Converge moves forward with an intensified commitment to provide world-class, 30 Products and Services fast and reliable internet services, and technology 32 Innovations solutions to every Filipino. 34 World-Class Partnerships 36 Awards and Recognition 38 Experience Commitment 44 Experience Fulfillment 44 Sustainability 46 COVID-19 Response 50 Corporate Governance 52 Risk Management 54 Board of Directors 60 Key Officers 64 Financial Statements 76 Corporate Information Please refer to our 2020 SEC 17A Report for the Notes to the Financial Statements (https://corporate.convergeict.com/wp-content/uploads/2020/10/CNVRG_FY20_17A_vF.pdf) 2 CONVERGE ICT SOLUTIONS INC. EXPLORE A WORLD OF POSSIBILITIES: 3 ANNUAL REPORT 2020 #EXPERIENCEBETTER Message from the Chairman DEAR FELLOW SHAREHOLDERS, reach over 6.1 million Filipino homes across the country, representing a quarter of total Philippine households. Your Company, Converge ICT Solutions, Inc., responds This brings the company closer to its target of reaching to our country’s urgent need for a world-class digital 55% of the population with world-class fiber internet highway providing connectivity to our nation and people service by 2025. in this digital age. Using the latest fiber optic technology In November 2020, your Company reached a milestone of to deliver broadband services, your Company has having one million residential subscribers. Our subscriber committed itself to delivering the best quality and most base grew two-fold to 1.04 million at the end of 2020 reliable internet service to the largest number of Filipinos. compared to its year-ago level. Amid the pandemic, this commitment has become With the completion of its submarine cable laying to the even more critical as more people have had to rely on Visayas and Mindanao in the first half of 2021, connecting their home broadband connectivity for remote work the other major islands in central and southern Philippines arrangements, online classes for students and teachers, JOSE P. DE JESUS to its national fiber backbone, Converge expects to start and entertainment through the lockdowns and quarantine commercially launching its services in key cities and Chairman restrictions. The internet has also been our lifeline provinces in these regions by the second half of the year. connecting us to our friends and family, in lieu of in-person gatherings, and facilitating the delivery of vital services To support its fast-growing customer base, your Company and activities such as tele-medicine, e-commerce, and has also tripled its customer support workforce and COVID-19 news updates and information. added hundreds of service vehicles for install and repair FIBER-FAST BROADBAND teams since the quarantine restrictions were put in place in March 2020. As the only pure play, end-to-end fiber broadband network in the country, your Company has been able to provide the MOST COMMITTED TEAM fastest and most reliable internet service to our customers. Amid the pandemic, our own frontliners – our linemen and customer service personnel – are working tirelessly Global testing leader Ookla has validated that Converge to install and connect new subscribers and respond to offers the most consistent fixed internet performance in customers’ concerns to deliver the reliable high-speed Metro Manila, Central Luzon, Calabarzon (Cavite-Laguna- fiber broadband that they need. Batangas-Rizal-Quezon), Ilocos Region, and the Cordillera Administrative Region (“CAR”) for the first quarter of On behalf of the Board of Directors and Management, 2021, with consistent average download speeds of up to we would like to thank you, our Shareholders, for your 42.93 Mbps provided to our customers. continued support and inspiring confidence to your Company! We are grateful to you for taking this journey Converge has also been consistently topping the Philippine with us to deliver world-class fiber connectivity to our ISP Leaderboard of leading online streaming platform people. Netflix. In its latest March 2021 report, Converge again led the Netflix ISP Speed Index among all Philippine internet service providers. MASSIVE EXPANSION To bring its fiber-fast broadband services to more people across the country, Converge more than doubled its fiber backbone and distribution network to over 55,000 JOSE P. DE JESUS kilometers at the end of 2020 from its year-ago level to Chairman of the Board 4 CONVERGE ICT SOLUTIONS INC. EXPLORE A WORLD OF POSSIBILITIES: 5 ANNUAL REPORT 2020 #EXPERIENCEBETTER Message from the CEO DEAR FELLOW SHAREHOLDERS, from putting in place the government-mandated health and safety protocols, we also purchased our Without a doubt, 2020 is a year to be remembered own antigen testing machines for the regular testing throughout history. A global pandemic brought of our frontliners and all employees needed for widespread disruption and sweeping changes to critical operations. At the height of the community every facet of our lives. In a matter of months, people, quarantine regulations, we provided transportation businesses, industries, and governments had to service to our skeleton staff. For those who live in relearn a new way of living and functioning while the far-flung areas, we provided lodging facilities within threat of COVID-19 persists. the vicinity of the offices. Meanwhile, we continued to encourage work from home arrangements whenever For us in the Philippine fixed broadband industry, possible. We are also procuring vaccines for our it meant an explosion in demand as most Filipinos employees and their immediate family members. required reliable internet connection at home which DENNIS ANTHONY H. UY became their office, classroom, and entertainment Converge was also among the first to respond to CEO and Co-Founder center amid the community lockdowns. the needs of our immediate communities when the pandemic left millions of Filipinos jobless. We donated While Converge has been aggressively expanding its thousands of sets of personal protective equipment all-fiber network since 2019, the sudden surge in new for healthcare workers to more than a dozen cities installations and the resulting doubling of customer and municipalities in Pampanga and Tarlac. We have base prompted our Company to accelerate plans and continue to distribute relief goods, mostly rice to immediately serve the connectivity needs of our packs, to the most vulnerable barangays in the areas subscribers despite the mobility restrictions. where we operate. We also provide fiber connection for various COVID-related facilities, including the QUICK CRISIS RESPONSE latest one for the Kamia Residence Hall in UP Diliman Through our own construction company, Metroworks which has been converted into a quarantine facility ICT Construction Inc., we were able to intensify fiber through a partnership with the Philippine Red Cross. optic roll-out activities in areas where high-speed In 2020, we also augmented the government’s broadband is needed the most. With our micro- response against COVID-19 by providing the Inter- trenching and horizontal drilling technology, we were Agency Task Force for Emerging Infectious Diseases able to quickly penetrate even the densest cities with fiber-fast broadband that allowed them to work with minimum disruption to the community. We were and disseminate important information to the public also able to scale up our technical teams for new more efficiently. connections and repairs and add hundreds of service vehicles to our fleet. Our customer service agents BRIDGING THE DIGITAL DIVIDE tripled from since the start of the pandemic. As a product of the public school system, I am overjoyed to see our Company helping bridge the With the same urgency, we had to protect our digital divide in education by making online learning employees, especially our frontliners such as the possible for our public school students through installers and front desks in our business centers, a partnership
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