Fueling the Power of Connectedness
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Fueling the power of connectedness Building the information and data highway for the Philippines towards unlocking new opportunities, creating new possibilities and redefining experiences for Filipinos. The combined synergies of human minds have unparalleled potential. We envision to create infrastructure and services that leverage the collective power of technology to galvanize economic progress and collective success. We see Globe’s digital and internet services as enablers of personal and social fulfillment that strive to unlock innovative solutions to create a shared value story for Globe’s customers, the nation and the planet. You may access and download this Integrated Report through this QR Code. Meanwhile, Globe’s 2019 Audited Consolidated Financial Statements released and filed to relevant regulators on February 27, 2020, may be accessed from www.globe.com.ph. For further information regarding this Integrated Report, please contact [email protected] or [email protected]. 2 Fueling the power of connectedness Contents 4 Business Overview About Globe Conglomerate Map Globe Presence 2019 at a Glance 2019 Awards and Recognition About this Report 18 Leadership Message from the Chairman Message from the President Corporate Governance Board of Directors Risk Management Management Discussion & Analysis 82 Strategy Strategy Map Stakeholder Engagement Materiality How Globe Creates Value 94 Capitals Financial Manufactured Intellectual Human Social and Relationship Natural 164 Statutory Reports Certificates of Compliance Board Committee Reports External Assurance Statement Audited Financial Statements Overview 3 Globe Telecom 2019 Integrated Report Business Overview 4 Fueling the power of connectedness 5 Globe Telecom 2019 Integrated Report About Globe Telecom, Inc. Globe Telecom, Inc. (“Globe” or the “company”) is a leading Globe keeps Filipinos connected wherever they may be in full-service telecommunications company in the Philippines the world, through its tie-up with 776 roaming partners in 237 and is listed in the Philippine Stock Exchange under ticker calling destinations worldwide. symbol GLO. The company serves the telecommunications and technology needs of consumers and businesses across Its principals are Ayala Corporation and Singapore Telecom, an entire suite of products and services including mobile, both acknowledged industry leaders in the country and in fixed, broadband, data connectivity, internet and managed the region. services. It has major interests in financial technology, digital marketing solutions, venture capital funding for startups, and In 2019, Globe became a signatory to the United Nations virtual healthcare. Global Compact, committing to implement universal sustainability principles. Supported by over 8,000 employees and over 1.2 million retailers, distributors, and business partners nationwide, The company’s headquarters is located at The Globe Tower, the company currently has 94.2 million mobile subscribers, 32nd Street corner 7th Avenue, Bonifacio Global City, Taguig both prepaid and postpaid, and more than 2 million home City 1634, Metro Manila, Philippines. For more information, broadband customers. visit www.globe.com.ph. Follow @enjoyglobe on Facebook, Twitter, Instagram and YouTube. Vision Mission We see a Philippines where families’ We create wonderful experiences for dreams come true, businesses flourish people to have choices, overcome and the nation is admired. challenges and discover new ways to enjoy life. Values We put customers first. We value people together, we make the difference. We act with integrity. We care like an owner. We keep things simple. We move fast, we are better, everyday. 6 Fueling the power of connectedness Circle of Happiness EMPLOYEES are empowered and find meaning in work. CUSTOMERS are special and valued. SHAREHOLDERS are confident and rewarded. 7 Globe Telecom 2019 Integrated Report Conglomerate Map The Globe Group GLOBE TELECOM, INC INNOVE 100% TechnoGlobal1 49% ASTICOM 100% GTIBH 100% Globetel European Limited GTI Corp. GTHK Globetel Singapore 100% 100% 100% 100% UKGT3 100% GMI3 100% GIEE2 GTowers6 100% 100% Kickstart 100% Flipside5 40% Globe Capital Venture Holdings, Inc. Adspark Holdings Konsulta1 Globe Fintech4 100% 100% 50% 46% Adspark Inc. Fuse4 100% 100% Socialytics G-Xchange, Inc.4 7 Yondu 70% 100% 100% Bayantel 98.58% RCPI TelicPhil6 Sky Internet Globetel-Japan NLI 91% 58% 100% 100% 70.38% Taodharma 67% VTI1 50% BAHC1 50% BHC1 50% EC Pay7 77% 1Accounted for as Joint Ventures 2Liquidated in 2019 BMPL1 3Liquidated in 2018 4Deconsolidated in 2017 due to loss of control 10% (Accounted as Joint Ventures) 5Ceased Operation 6Incorporated in 2018 7Consolidated in 2019 8 Fueling the power of connectedness The 2019 consolidated financial statements include the accounts of Globe Telecom and the following subsidiaries: Parent Company’s Name of Place of Principal percentage of Subsidiary Incorporation Activity Ownership 2019 2018 Subsidiaries Innove Philippines Wireline voice and data communication services 100% 100% GTI Philippines Holding company 100% 100% GTIC United States Wireless and data communication services 100% 100% GTHK Hong Kong Marketing and distributing company 100% 100% GTSG Singapore Wireless and data communication services 100% 100% GTEU United Kingdom Holding company 100% 100% UKGT*** United Kingdom Wireless and data communications services - - GMI*** Italy Wireless and data communications services - - GIEE** Spain Wireless and data communications services - 100% KVI Philippines Venture capital company 100% 100% FPSI* Philippines E-book solutions 40% 40% Asticom Philippines Support and shared services provider 100% 100% GCVHI Philippines Holding company 100% 100% GFI**** Philippines Holding company 46% 45% Fuse**** Philippines Lending company 100% 100% GXI**** Philippines Fintech company 100% 100% AHI Philippines Holding company 100% 100% AI Philippines Advertising company 100% 100% Socialytics Philippines Advertising company 70% 70% BTI Philippines Wireline voice and data communication services 99% 99% RCPI Philippines Wireline communication services 91% 91% Telicphil* Philippines Telco equipment administration and maintenance 58% 58% Sky Internet Philippines Data communication services 100% 100% GlobeTel Japan Japan Wireless and data communication services 100% 100% NLI Philippines Land holding company 70% 70% Tao Philippines Distributing company 67% 67% G. Towers Inc.***** Philippines Tower company 100% 100% Yondu****** Philippines Information technology and software development 100% 49% EC Pay****** Philippines Information technology and electronic services 77% - Details of the Globe Group’s investments in associate and joint ventures and the related percentages of ownership as of December 31, 2019 and 2018 are shown below: Associates Yondu******* Philippines Mobile content and application development services 100% 49% AFPI Philippines Construction and establishment of systems, infrastructure - 20% Joint Ventures VTI Philippines Telecommunications 50% 50% BAHC Philippines Holding company 50% 50% BHC Philippines Holding company 50% 50% Konsulta Philippines Health hotline facility 50% 50% TechGlobal Philippines Installation and management of data centers 49% 49% GFI/Mynt******** Philippines Holding company 46% 45% BMPL Singapore Mobile technology infrastructure and common service 10% 10% * Ceased Operations ***** Incorporated in 2018 ** Liquidated in 2019 ****** Consolidated in 2019 *** Liquidated in 2018 *******A subsidiary of Globe Telecom through GCVHI until September 2017 **** Deconsolidated in 2017 due to loss of control ********An associate of Globe Telecom until September 2019 9 Globe Telecom 2019 Integrated Report Globe Value Map Brands, Products and Services Partners Globe Postpaid Over 1.2 million AMAX retailers, distributors and business partners nationwide Prepaid Globe Prepaid TM Corporate Offices Valero Telepark Fixed Line and Home Home Broadband TGT (The Globe Tower) Broadband Business Corporate Data W City Center Fixed Line Voice GTPlaza 1 and GTPlaza 2 International Long Distance Services GTITPlaza Lahug TGT-Cebu Mandalagan Bacolod Customers JM Basa Iloilo 94.2 million over 2 million CDO Gateway Corp Office mobile home broadband Davao Abreeza customers customers Employees 8,048 Globe employees Vendors 840 234 local international vendors vendors Globe Stores AYALA CENTRIO CDO KCC MALL KORONADAL SM TARLAC PD FISHERMALL CDO LIMKETKAI GOS MIDSAYAP PD IBA ZAMBALES PD ROBINSONS MAGNOLIA QC VALENCIA SM GENERAL SANTOS PD BALANGA BATAAN SM MASINAG SM CDO PD TACURONG SM TELABASTAGAN SM ANGONO PD GINGOOG MISAMIS ORIENTAL PD KIDAPAWAN SM CLARK SM TAYTAY PD MALAYBALAY, BUKIDNON PD KCC MALL GENSAN SM SAN FERNANDO PD MONTALBAN RIZAL PD SM CDO PREMIER TUGUEGARAO SM PAMPANGA PD ROBINSONS PLACE ANTIPOLO GAISANO BUTUAN PD SANTIAGO PD MARQUEE MALL PD SM SAN MATEO PD SAN FRANCISCO PD ILAGAN ISABELA SM BALIUAG PD TANAY RIZAL PD TANDAG PD ROXAS ISABELA SM MARILAO ROBINSONS GALLERIA PD SURIGAO PD SOLANO PD GRACELAND MALOLOS SM EAST ORTIGAS OZAMIS PD SM CAUAYAN PD SM SAN JOSE DEL MONTE SM MARIKINA GAISANO ILIGAN PACIFIC MALL CABANATUAN PD STARMALL SAN JOSE DEL MONTE AYALA 30TH PAGADIAN MS SM CABANATUAN PD PLARIDEL PD LUCKY GOLD ZAMBOANGA WALTERMART GAPAN PD STA. MARIA PD STA. LUCIA PD DIPOLOG PD BALER, AURORA SM VALENZUELA GREENHILLS PD OROQUIETA CANDON PD ROBINSONS TOWN MALL MALABON SHANGRI-LA PD ZAMBOANGA VIGAN PD SM CENTER SANGANDAAN SM MEGAMALL PD SINDANGAN PUREGOLD LAOAG PD VALENZUELA TOWN CENTER ALABANG TOWN CENTER DAVAO ABREEZA SM