Philippines' PLDT forecasts first annual growth in three years

(Repeats to more subscribers, with no change to text)

MANILA, March 7 (Reuters) - The Philippines' most valuable

telecoms firm, PLDT Inc, on Tuesday said recurring

income will likely grow in 2017 for the first time in three

years, recovering from a price war and shift to mobile internet

services that have eroded revenue from calls and texts.

PLDT and rival Globe Telecom Inc last year raised

the ire of President Rodrigo Duterte who accused them of failing

to improve services. He gave them a year to reform otherwise he

would open up the telecoms sector to foreign competition.

PLDT, part-owned by Japan's NTT DoCoMo Inc and Hong

Kong's First Pacific Co Ltd, said recurring core

income is likely to reach 21.5 billion pesos ($427.61 million)

in 2017.

Recurring core income, which excludes proceeds from asset

sales, accelerated depreciation, one-time provisions and

subsidies, totalled 20.2 billion pesos last year.

"We faced very tough tests in the past year as competition

intensified and the shift to digital services accelerated," PLDT

Chairman Manuel Pangilinan said in a statement.

PLDT and Globe are engaged in a price war to attract mobile

internet subscribers, spurred by the spread of smartphones,

while revenue continues to fall in the traditional cash cows of

calls and text messaging.

The Philippines' telecoms services are widely considered to

be among the world's poorest, frustrating businesses and

consumers with intermittent data, dropped calls and poor

cellular coverage, even in urban centres.

($1 = 50.2790 Philippine pesos)

(Reporting by Neil Jerome Morales; Editing by Christopher