SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 

 

FORM 6-K

Report of Foreign Private Issuer 

 

Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934

 

 

**For the month of September 2009**
 

 

**Commission File Number 1-03006**

 

 

Philippine Long Distance Telephone Company
(Exact Name of Registrant asSpecified in Its Charter)

 

**Ramon****Cojuangco Building**

**Makati Avenue**

**Makati****City**

**Philippines**

(Address of principal executiveoffices)

 

 

(Indicate by check markwhether the registrant files or will file annual reports under cover Form 20-For Form 40-F.)

 

Form20-F      Ö                                  Form40-F

 

 

(Indicate by check markwhether by furnishing the information contained in this Form, the registrant isalso thereby furnishing the information to the Commission pursuant to Rule12g3-2(b) under the Securities Exchange Act of 1934.)

 

Yes                                                        No       Ö

 

 

(If "Yes" ismarked, indicate below the file number assigned to the registrant in connectionwith Rule 12g3-2(b): 82- ________ )
****
 

 

NOTE REGARDINGFORWARD-LOOKING STATEMENTS

 

Some information in this report may containforward-looking statements within the meaning of Section 27A of the U.S.Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of1934.  We have based these forward-looking statements on our current beliefs,expectations and intentions as to facts, actions and events that will or mayoccur in the future.  Such statements generally are identified byforward-looking words such as “believe,” “plan,” “anticipate,” “continue,” “estimate,”“expect,” “may,” “will” or other similar words.

A forward-looking statement may include astatement of the assumptions or bases underlying the forward-lookingstatement.  We have chosen these assumptions or bases in good faith.  Theseforward-looking statements are subject to risks, uncertainties and assumptions,some of which are beyond our control.  In addition, these forward-lookingstatements reflect our current views with respect to future events and are nota guarantee of future performance.  Actual results may differ materially frominformation contained in the forward-looking statements as a result of a numberof factors, including, without limitation, the risk factors set forth in“Item 3. Key Information – Risk Factors” in our annual report on Form 20-Ffor the fiscal year ended December 31, 2008.  You should also keep in mind thatany forward-looking statement made by us in this report or elsewhere speaksonly as at the date on which we made it.  New risks and uncertainties come upfrom time to time, and it is impossible for us to predict these events or howthey may affect us.  We have no duty to, and do not intend to, update or revisethe statements in this report after the date hereof.  In light of these risksand uncertainties, you should keep in mind that actual results may differmaterially from any forward-looking statement made in this report or elsewhere.

 
 

 

**EXHIBITS**
 

 

 

Exhibit Number

 

Page

 

 

1

 

 

 

 

 

 

 

Copy of the disclosure letter that we filed today with the Securities and Exchange Commission and the Philippine Stock Exchange regarding the press release issued by Fitch Ratings (Fitch) entitled “Fitch Revises Outlook on PLDT’s Local Currency Rating to Stable”.  

 

 

 

 

6

 

 

 

 

 

 

 

 

 

 

Exhibit 1

 

 

** **

   

September 9, 2009 

 
 

 

The Philippine Stock Exchange
4th Floor PSECentre

Exchange Road, Ortigas Center

Pasig City

 

Attention:        Ms.Janet A. Encarnacion

Head,Disclosure Department

 

Ladies and Gentlemen:

 

In compliance withSection 17.1(b) and Section 17.3 of the Securities Regulation Code, we submitherewith a copy of SEC Form 17-C with a copy of a press release issued by FitchRatings (Fitch) attached thereto entitled “Fitch Revises Outlook on PLDT’sLocal Currency Rating to Stable”.  

 

This shall also serve asour disclosure letter for the purpose of complying with the PSE RevisedDisclosure Rules.

 

 

Respectfully yours,

 

/s/ Florentino D. Mabasa,Jr.

FLORENTINO D. MABASA, JR.

Assistant CorporateSecretary 

 

Page 1 of 6

    

Exhibit 1

 

 

 

September 9,2009

 

 

SECURITIES &EXCHANGE COMMISSION

Money MarketOperations Department

SEC Building, EDSA

Mandaluyong City

 

Attention         :           DirectorJustina F. Callangan

                                    CorporationsFinance Department

 

Gentlemen:

 

Re       :           PhilippineLong Distance Telephone Company

                        SECRegistration No. PW-55

 

In accordance withSection 17.1 (b) of the Securities Regulation Code, we submit herewith three(3) copies of SEC Form 17-C with a copy of a press release issued by Fitch Ratings(Fitch) attached thereto entitled “Fitch Revises Outlook on PLDT’s LocalCurrency Rating to Stable”.  

 

 

Respectfully yours,

 

/s/ Florentino D. Mabasa,Jr.

FLORENTINO D. MABASA, JR.

Assistant CorporateSecretary 

 

Page 2 of 6

    

Exhibit1

 

 

SECURITIES ANDEXCHANGE COMMISSION

 

 

SEC FORM 17-C

 

CURRENT REPORTUNDER SECTION 17

OF THESECURITIES REGULATION CODE

AND SRCRULE 17.1

 

 

1.                 September 9, 2009 

(Date of earliest event reported)

 

2.                 SEC Identification Number  PW-55

 

3.                 BIR Tax Identification No. 000-488-793

 

4.                 PHILIPPINE LONGDISTANCE TELEPHONE COMPANY                                        

            Exactname of registrant as specified in its charter

 

5.         PHILIPPINES6. _____________ (SEC Use Only)  

           Province, country or otherjurisdiction             Industry Classification Code

of Incorporation

 

7.         9th Floor MGO Building

            Legaspicorner dela Rosa Streets, Makati City                                  1200 

     Address of principal office                                                                  PostalCode

 

8.         (632)816-8553                                           

           Registrant's telephone number, including areacode
 

9.         NotApplicable                                                               

            Formername or former address, if changed since last report

 

10.       Securitiesregistered pursuant to Sections 8 and 12 of the SRC

 

            Titleof Each Class                             Number of Shares of Common Stock

                                                                        Licensedand Amount of Debt Outstanding

 

Page 3 of 6

    

 

Exhibit1

 

 

11.       Item9 – Other Events

 

Attached hereto is a press release issued byFitch Ratings (Fitch) entitled “Fitch Revises Outlook on PLDT’s Local CurrencyRating to Stable”.  

 

 

 

SIGNATURE

 

            Pursuantto the requirements of the Securities Regulation Code, the Registrant has dulycaused this report to be signed on its behalf by the undersigned hereto dulyauthorized.

 

 

 

 

PHILIPPINE LONG DISTANCE

TELEPHONE COMPANY

 

 

/s/ Florentino D. Mabasa, Jr.

FLORENTINO D. MABASA, JR.

Assistant Corporate Secretary

 

 

 

Date:   September 9, 2009

 

 

Page 4 of 6

  Exhibit 1

 

**FitchRatings**

**KNOWYOUR RISK**

 

**FITCH REVISES OUTLOOK ON PLDT'S LOCAL CURRENCYRATING TO STABLE**

FitchRatings-Singapore/Sydney-08 September 2009: Fitch Ratings has today affirmedPhilippine Long Distance Telephone Company's (PLDT) Long-term local currency(LC) IDR at 'BBB' and revised the rating Outlook to Stable from Negative. Atthe same time, Fitch has affirmed PLDT's Long-term foreign currency IssuerDefault Rating (IDR) and the rating of its outstanding global bonds and seniornotes at 'BB+'. The agency also affirmed the company's National Long-termrating at 'AAA(phl)'. The rating Outlook is Stable. 

 

TheOutlook revision on PLDT's LC IDR reflects diminished risk related to potentialfinancial support for associate company Manila Electric Company (Meralco), atleast over the near-term. Under the aegis of new major shareholders, PLDT andSan Miguel Corporation (SMC), Meralco's operating prospects appear to have improvedsomewhat. Notably, the company has been able to raise distribution chargesunder performance-based regulation in Q209. 

 

PLDT'sratings reflect its position as the Philippines' incumbent operator, withdiversified and integrated telecommunications operations, as well as growingoperations in call centres and business process outsourcing. The company holdsa leading share of fixed-line subscribers (around 60%) and a dominant share(approximately 67%) of the nascent broadband market. Fitch expects fixed-lineservices to remain a core contributor to earnings and cash flow over the mediumterm, with strong demand for fixed-data, offsetting substitution pressures ontraditional voice services. 

 

PLDT'scellular business is the main driver of its consolidated profile, accountingfor 61% of revenue and 69% of EBITDA in H109. Although the Philippines cellular market is now quite mature in terms of the addressable populace,subscription growth remained strong in H109. Total subscribers increased to38.5 million as at H109 from 35.2m at FY08, implying an annualised growth of19% and a market share of 52%. However, Fitch notes that PLDT's medium-termgrowth prospects are modest since penetration of subscriber identificationmodules are now at a high of approximately 82%. 

 

Theratings also take into account rising industry risks, with potential forincreased competition from new entrant, SMC, over the medium-term, as well asheightened regulatory risks in light of recent directives on prepaid-cellularload extension and on the change in the unit of billing for cellular services. 

 

At H109,PLDT's net adjusted leverage (defined as total adjusted debt net of cash byOperating EBITDAR) stood at 0.5x and FFO by Gross Interest Expense stood at14.0x. "The rating factors in a slight weakening in credit protectionmeasures for FY09, which mainly reflects PLDT's acquisition of an additional20% stake in Meralco," said Priya Gupta, Director in Fitch's Asia-Pacifictelecommunications, media and technology group. 

Page 5 of 6

  Exhibit 1

 

"Whilethis increase in leverage can be accommodated at PLDT's current local currencyrating of 'BBB', there is virtually no headroom for further debt-fundedacquisitions of material size," she added. The ratings are likely to comeunder downward pressure if the agency expects PLDT's net adjusted leverage toexceed 1.0x on a sustainable basis or its post-dividend FCF to turn negative. 

 

PLDT'slocal currency rating of 'BBB'/Stable (which exceeds the sovereign localcurrency rating by two notches) ignores foreign currency transfer andconvertibility risk, and is more reflective of its stand-alone credit profile.In terms of its foreign currency IDR, PLDT remains constrained by the Philippines' country ceiling, which is currently 'BB+'. The National rating of 'AAA(phl)'incorporates all the above factors and is indicative of PLDT's relative creditstrength among all Philippine companies. 

 

Contacts: Priya Gupta, Singapore, +65 6796 7222/ priya.gupta@fitchratings.com; Vicky Melbourne, Sydney, +612 8256 0325/vicky.melbourne@fitchratings.com. 

 

MediaRelations: Iselle Gonzalez, Sydney, Tel: +612 8256 0326, Email:iselle.gonzalez@fitchratings.com; Lisa Lim, Singapore, Tel: +65 6796 7214,Email: lisa.lim@fitchratings.com; Shivani Sundralingam, Singapore, Tel: + 65 6796 7215, Email: shivani.sundralingam@fitchratings.com. 

 

Fitch's rating definitionsand the terms of use of such ratings are available on the agency's public site,www.fitchratings.com. Published ratings, criteria and methodologies areavailable from this site, at all times. Fitch's code of conduct,confidentiality, conflicts of interest, affiliate firewall, compliance andother relevant policies and procedures are also available from the 'Code ofConduct' section of this site. The issuers did not participate in the ratingprocess other than through the medium of their public disclosure. 

 

 

Page 6 of 6

   

Signatures

 

 

Pursuantto the requirements of the Securities Exchange Act of 1934, the registrant hasduly caused this report to be signed on its behalf by the undersigned,thereunto duly authorized.

 

 

PHILIPPINE LONG DISTANCE

TELEPHONE COMPANY

 

 

 

By        :     /s/ Florentino D. Mabasa, Jr.

Name  :     Florentino D. Mabasa,Jr. 

Title     :     First Vice President, Legal Services Head and Assistant Corporate Secretary

 

 

Date:September 9, 2009