dtac clinches TOT 4G deal, reveals profit jump - Mobile World Live

dtac clinches TOT 4G deal, reveals profit jump

24 APR 2018

Dtac, Thailand’s third largest operator by subscribers, reported a spike in profit in Q1 2018 due to a one-off adjustment, but experienced continued weakening in service revenue.

On the positive side, the operator, a subsidiary of Norway-headquartered Telenor, received final approval to run 4G service for state-owned TOT on the 2.3GHz band and reported growth in post paid subscribers and ARPU.

The operator’s Q1 net profit jumped 474 per cent to THB1.3 billion ($41.3 million), which the company attributed to strong EBITDA growth and a one-time adjustment related to disputes with CAT Telecom on revenue share, resulting in a lower financial cost of THB528 million (before tax) in the quarter.

Total revenue decreased 3.5 per cent year-on-year to THB19.06 billion due to declining service and handset revenue and an interconnection (IC) rate reduction. Starting from Q1 2018, the new IC rate was THB0.19 per minute, down from THB0.27 per minute. Service revenues excluding IC fell 1.1 per cent to THB16.04 billion.

The operator continued to shed subscribers, losing 850,000 in Q1. Its total subs base fell 10.3 per cent year-on-year to 21.8 million at end-March. Excluding customers on its 2G concession (about 470,000) with CAT Telecom which expires in September, post paid subs rose 13 per cent year-on-year to 5.47 million, while prepaid subs dropped 14 per cent to 15.9 million.

Prepaid ARPU dipped 1.9 per cent from Q1 2017 to THB150 in the recent quarter: post paid ARPU was stable at THB560.

TOT partnership
The company announced it secured the necessary approvals to launch 4G services on TOT’s 2.3GHz spectrum. TOT holds 60MHz of TD-LTE spectrum in the band. In May 2017 TOT selected dtac as its preferred partner to run 4G services.

Dtac will build out a network on the 2.3GHz band and have the right to use up to 60 per cent of the capacity for a fixed annual fee of THB4.5 billion. The deal runs until 2025.

In a statement it said: “As the concession expiration approaches, dtac expects no interruption of service provided to customers regardless of the auction timeline. In addition, the partnership with TOT on 2300MHz wireless service will help strengthen our network capacity to offer the best digital services to the consumers. Capex of THB15-18 billion is expected to be spent in FY18.”

Service revenue (excluding IC) in 2018 is expected to be about the same level as in 2017, while EBITDA margin is expected to be in the range of 34 per cent to 36 per cent.


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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