KDDI targets 2nd year of double-digit profit growth

KDDI targets 2nd year of double-digit profit growth

30 JAN 2015

Japan’s KDDI posted strong gains in both profit and revenue for the first nine months of its fiscal year, with 4G subscribers almost doubling and ARPU stable.

Its net income for the period ending 31 December expanded 30 per cent to JPY351 billion ($2.96 billion), while its operating revenue increased 5.4 per cent to JPY3.352 trillion.

The company, the country’s third largest operator with a 25 per cent market share (just behind number two SoftBank), said it hit 80 per cent of its operating income target for the full fiscal year, positioning it for its second consecutive year of double-digit income growth.

KDDI added 7.1 million 4G connections in 2014, ending the year with 16.2 million 4G connections, according to GSMA Intelligence. 4G subscribers now account for 41 per cent of its 39.4 million mobile customers, which grew 6 per cent from a year ago. Mobile communications revenue expanded 62 per cent during the period, while ‘au’ sales commission dropped 53 per cent.

ARPU inched up JPY10 to JPY4,250 from the final quarter of 2013, while churn held steady at 0.66 per cent.

Subscribers to its UQ WiMAX service increased 72 per cent to 7.15 million from a year ago. FTTH connections grew 8 per cent to 3.41 million. Cable TV connections were almost unchanged at five million.

Operating expenses rose 4.5 per cent year-on-year, to JPY2.76 trillion, due to increases in terminal procurement expenses and higher depreciation and amortisation in line with the expansion of its LTE network.

Sales of smartphones increased to 2.7 million units during the quarter from 2.12 million a year ago. Users of its au Smart Pass value-added service increased by 36 per cent from a year ago to more than 12 million.

Capex jumped 24 per cent to JPY463 billion in its first three quarters, with wireless investment expanding 42 per cent from the same period a year ago to JPY323.6 billion. Its capex target for the full fiscal year is JPY580 billion – about the same level as fiscal 2014.

The company’s EBITDA increased 7.4 per cent to JPY985.9 billion and its EBITA margin rose half a point to 29.4 per cent.

It announced a 3:1 stock split effective 1 April.

Giving an update on its joint investment with Sunitomo in state-owned Myanma Posts & Telecommunications (MPT), KDDI said the incumbent operator in Myanmar has now sold more than five million SIM cards, after selling one million in September.


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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