EX-7 4 phi-ex7_11.htm EX-7 phi-ex7_11.htm

 

EXHIBIT 7

 

 

 

 

PLDT Inc.

Calculation of Ratio of Earnings to Fixed Charges

For the years 2013 through 2017

 

 

2017(1)

2017

2016

2015

2014

2013

 

(in millions, except ratio of earnings to fixed charges)

Earnings:  Income before income tax

 

 

 

 

 

 

Pre-tax income from continuing operations before adjustment for non-controlling interest in consolidated subsidiaries or income or loss from equity investees subsidiaries

US$292

Php14,569

Php22,071

Php26,638

Php44,148

Php41,632

Add (Deduct):

 

 

 

 

 

 

Fixed Charges (see description below)

224

11,204

10,622

9,015

8,266

9,060

Amortization of capitalized interest

14

714

829

941

1,198

1,221

Capitalized interest

(16)

(816)

(566)

(370)

(442)

(421)

Total Earnings(2)

US$514

Php25,671

Php32,956

Php36,224

Php53,170

Php51,492

Fixed Charges

 

 

 

 

 

 

Interest on loans and related items

US$157

Php7,830

Php7,522

Php6,289

Php5,429

Php5,086

Capitalized interest

16

816

566

370

442

421

Amortization of debt issuance costs and debt discount

4

219

230

231

164

1,539

Estimated financing component of rent expense(3)

47

2,339

2,304

2,125

2,231

2,014

Total Fixed Charges

US$224

Php11,204

Php10,622

Php9,015

Php8,266

Php9,060

Ratio (a/b)(2)

2.3

2.3

3.1

4.0

6.4

5.7

 

(1)

We maintain our accounts in Philippine pesos, the functional and presentation currency under IFRS.  For convenience, the Philippine peso financial information as at and for the year ended December 31, 2017 has been converted into U.S. dollars at the exchange rate of Php49.96 to US$1.00, the Philippine peso-dollar rate as quoted through the Philippine Dealing System as at December 31, 2017.

 

(2)

For purposes of this ratio, “Earnings” consist of: (a) pre-tax income from continuing operations before adjustment for non-controlling interest in consolidated subsidiaries or income or loss from equity investees, (b) fixed charges, (c) amortization of capitalized interest, (d) distributed income of equity investees, and (e) share of pre-tax losses of equity investees for which charges arising from guarantees are included in fixed charges; less the sum of the following: (1) capitalized interest, (2) preference security dividend requirements of consolidated subsidiaries, and (3) the non-controlling interests in pre-tax income of subsidiaries that have not incurred fixed charges.

 

“Fixed charges” consist of interest expense and capitalized interest, amortized premiums, discounts and capitalized expenses related to indebtedness, an estimate of interest within rental expense, and preference security dividend requirements of consolidated subsidiaries.

 

(3)

Rent expense substantially represents payments for the leased circuits by PLDT.  Historically, PLDT has been using one-third of rent expense as a reasonable estimate of the financing component of rent expense, since it is impracticable to determine the actual financing component of rent expense.