Singapore operator M1 reported a healthy increase in both its net profit and overall revenue last year as it benefited from strong growth in data usage and higher handset sales.

Its net profit after tax expanded 9.7 per cent year-on-year to SGD175.8 million ($131.8 million), while its operating revenue increased 6.8 per cent to SGD1.0763 billion.

Service revenue was up only 1.4 per cent year-on-year to SGD831.1 million, but mobile revenue grew 4.2 per cent to SGD671.1 million, thanks to a 5.8 per cent increase in postpaid revenue to SGD591 million. Prepaid revenue dropped 6.7 per cent to SGD80 million. Revenue from non-voice services rose 5.7 percentage points and now accounts for 47.3 per cent of service revenue (up from 41.6 per cent a year ago).

Handsets sales climbed 30 per cent last year to SGD245 million. Handset costs were up 16 per cent for the year. The cost of sales and other operating expenses were flat in 2014, however, capex and spectrum costs jumped 44 per cent to SGD180 million (spectrum costs accounted for most of that increase).

Postpaid ARPU rose 1 per cent to SGD62.4, but data plan ARPU dropped 9.1 per cent to SGD18.90. Two-thirds of its postpaid customers are on tiered data plans, with an average of 22 per cent exceeding their monthly data bundle. Prepaid ARPU fell 2 per cent to SGD14.50, and monthly fibre ARPU was also off by 4.8 per cent to SGD43.90.

Its postpaid customer base edged up marginally by 19,000 year-on-year to 1.15 million, while the prepaid customer base, impacted by a regulatory change, dropped 28 per cent to 703,000. During the year, its fibre customer base expanded 21 per cent to 103,000.

M1, which is the third ranked mobile operator in the country, saw its market share drop from 25 per cent to 23.3 per cent last year. Its postpaid share remained fairly steady at almost 25 per cent, but its share of the prepaid market declined from 25 per cent to 21 per cent.

International call revenue fell 21.6 per cent to SGD89 million (minutes were down 13.2 per cent).

The operator’s EBIDTA margin increase 2.3 points to 40.4 per cent of service revenue. The board has recommended a final dividend of SGD0.119 per share, for a full-year payout of SGD0.189 per share.

M1 estimates moderate growth in net profit after tax this year.