Taiwan Mobile president Lin Zhichen forecast sales growth to accelerate in 2021, driven by its mobile and e-commerce businesses, but expects profitability to be flat to slightly down as capex remains elevated.
“We will be investing in mobile subscriber acquisition and retention, focusing on longer-term contracts to lock in ARPU and prevent future churn,” he said in an earnings call.
The operator expects revenue to increase 12 per cent to 15 per cent in 2021, driven by double-digit gains in e-commerce and new technology services. Telecoms related revenue is predicted to increase 4 per cent to 6 per cent.
It earmarked TWD11.8 billion ($424 million) in capex for 2021. Capex in 2020 increased 62 per cent to TWD11.55 billion: spending on mobile was up 82 per cent from 2019 to TWD8.59 billion.
It signed up 465,000 5G users in 2020 since launching the service in June 2020, accounting for 6.4 per cent of its overall subscribers base.
Lin said 5G adoption was boosted by the release of the iPhone 12 series, with 80 per cent of the users signing up for high-end bundles starting at TWD1,399. Overall, more than 80 per cent of 5G subscribers are on TWD999 plans or higher.
Net profit in Q4 dropped 29 per cent year-on-year to TWD2.11 billion, due mainly to higher depreciation and amortisation costs from its 5G rollout and a jump in marketing expenses. Consolidated revenue grew 13 per cent to TWD38.4 billion, led by a 34 per cent jump in e-commerce sales to TWD19.1 billion.
Mobile service revenue dipped 5 per cent to TWD11.85 billion, as blended ARPU dropped 5 per cent to TWD545. Device sales grew 7 per cent to TWD5.82 billion.
Mobile subscribers edged up 1 per cent to 7.26 million at end-December.
Lin said it will reduce 5G site rollouts by half, as it is “ahead of the pack in terms of the number of 5G sites running on the 3.5GBz band”, but telecoms capex will remain at about the 2020 level.
It ended 2020 with about 6,000 3.5GHz base stations.