Cost cuts deliver profit gains for dtac - Mobile World Live

Cost cuts deliver profit gains for dtac

16 JUL 2020

Thai operator dtac grew profit in Q2 despite declines in revenue and prepaid user numbers caused by the Covid-19 (coronavirus) pandemic.

In a statement, CEO Sharad Mehrotra said the outbreak peaked during the period, with a month-long closure of shops directly impacting revenue from the tourist and migrant segments, along with roaming and new customer acquisition, resulting in an overall decline in customer spending.

CFO Dilip Pal explained dtac maintained profitability through cost optimisation efforts, which he said would remain a key focus over the rest of 2020 due to uncertainty around top-line growth.

Net profit rose 20 per cent year-on-year to THB1.89 billion ($59.7 million), which the company said was mainly driven by the better cost management and a sharp fall in capex.

Service revenue declined 4.2 per cent to THB15.03 billion, while handset sales fell 31.8 per cent to THB19.2 billion. International roaming revenue was down 56.9 per cent to THB79 million.

Network opex decreased 6.9 per cent to THB1.6 billion as a result of network and IT cost optimisation initiatives, capitalisation of lease contracts and a reduction in lease expenses with stated-own CAT.

Capex declined 40 per cent to THB1.4 billion.

Subscriber losses
Its mobile subscriber base fell 8.9 per cent to 18.8 million, with the prepaid segment down 11.3 per cent to 12.7 million.

Prepaid ARPU decreased 9.1 per cent to THB129 and post-paid slid 2.2 per cent to THB539.

Mehrotra said although it observed some early signs of recovery in customer acquisition, its revenue growth prospects for the second half remains uncertain.

For the full year, dtac forecast a low single-digit decline to service revenue and EBITDA to remain at the 2019 level.

Capex was set at THB8 billion to THB10 billion, down from THB13 billion in 2019.



Joseph Waring

Joseph Waring joins Mobile World Live as the Asia editor for its new Asia channel. Before joining the GSMA, Joseph was group editor for Telecom Asia for more than ten years. In addition to writing features, news and blogs, he...

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