ETPI sets aside $13m for NGN spending

(Philippine Daily Inquirer via NewsEdge) Manila-based carrier Eastern Telecommunications Philippines (ETPI), a 57.7% owned subsidiary of listed firm ISM Communications, is spending 600 million pesos ($13 million) to transform itself into a next generation telecommunications provider, ISM president Eric Recto said.

Last year, ETPI's capital expenditure amounted to 129 million pesos ($2.8 million).

This was used primarily in replacing its local exchange carrier switches with next generation networking technology.

ETPI has invested in an NGN core by Nokia. There will be additional capex in NGN to convert the traditional system of telephony, Recto said.

The carrier made a dramatic turn around in 2006 after six years of losses and reported a profit of 31 million pesos ($678,000). In 2005, the company's losses reached 540 million pesos ($11.8 million).

ETPI's favorable performance was driven mainly by massive cost savings program, corporate reorganization, restructuring of overdue loans and settlement of vendor claims and dividend income from ETPI's investment in a cable ship operator.

Part of the funds for ETPI's capital requirement will come from a stock right offer of ISM.