Dtac plans job cuts despite profit growth - Mobile World Live

Dtac plans job cuts despite profit growth

01 FEB 2018

Dtac continued to face headwinds in Q4 2017, as revenue declined despite double-digit data growth and it lost market share as it shed prepaid subscribers.

On the positive side, the third largest mobile operator in Thailand generated a sharp rise in net profit during the quarter and higher ARPU. Dtac said it will cut 1,000 jobs this year as part of parent company Telenor’s plan to eliminate 6,000 jobs over the next three years in an aggressive cost-cutting programme.

In a statement dtac said: “Lower revenue for voice services and over-priced spectrum licences have put pressure on financial return. Nevertheless, the industry remains a growing, profitable market and several revenue opportunities can be seized.”

The operator’s net profit in Q4 2017 jumped to THB542 million ($17.3 million) from THB30 million in Q4 2016, due to a sharp drop in regulatory costs and lower handset subsidies. Net profit for the full year inched up 1.4 per cent to THB2.12 billion.

Revenue during the recent quarter fell 5.5 per cent year-on-year to THB20.3 billion, due in part to a 25 per cent drop in handset sales to THB3.04 billion. Service revenue was down 0.6 per cent to THB17 billion, data revenue grew 16 per cent to THB11 billion, but voice dropped 23 per cent to THB3.87 billion.

Subscriber losses
The operator continued to lose subscribers, with total subs falling 7.5 per cent year-on-year in 2017 to 22.65 million. Prepaid subs dropped 12.2 per cent to 17 million, while post paid users increased 12.5 per cent to 5.6 million.

Dtac’s market share dropped by 2 percentage points in 2017 to 24.5 per cent and it was overtaken rival True Move, which ended the year with a 29 per cent share, GSMA Intelligence data showed.

Blended APRU rose 4.7 per cent year-on-year in Q4 to THB250, with post paid ARPU up 3 per cent to THB578 and prepaid ARPU falling 5.1 per cent to THB152.

The company said a partnership with state-owned telecoms operator TOT to deploy 4G service on the 2.3GHz band will increase its 4G bandwidth. Dtac’s concessions with state-owned CAT Telecom to operate 10MHz on the 850MHz band and 45MHz on the 1.8GHz band expire in September 2018. The country plans to hold a 1.8GHz spectrum auction soon.

As the expiration approaches, dtac said it has a “strong intention to secure more spectrum to strengthen our network capacity”.

Its guidance for 2018 forecasts service revenue and EBITDA to remain at 2017 levels, and its capex budget to range from THB15 billion to THB18 billion.

Author

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...

Read more

Related

Tags