Singapore operator StarHub felt the impact of higher operational expenditure at its security joint venture and another quarter of falling mobile service revenue in Q1.
Its net profit dropped 23.3 per cent year-on-year to SGD49.3 million ($36.2 million), which it attributed to increased investment at Ensign, its security joint venture with state investor Temasek Holdings. Excluding the impact of cybersecurity services, net profit would have been SDG61 million, said CEO Peter Kaliaropoulos.
Total revenue rose 6 per cent to SGD596.8 million, with continued weakness in mobile service revenue (down 5.3 per cent to SGD192 million) and pay-TV sales (SGD70.7 million, 12.4 per cent lower) offset by a 33.2 per cent increase in equipment sales to SGD153 million and a 14.1 per cent jump its enterprise services business to SGD134 million.
Kaliaropoulos said in a statement: “In 2019, we started implementing our transformation programme aimed at improving our customers’ experience. We are revitalising our brand image, simplifying mobile and TV offers, providing clarity with all fees, and enhancing our consumers’ ability to transact with us on My StarHub app and online.”
He noted that despite increased competitive intensity, it added 74,000 post-paid subscribers year-on-year to take its total to 1.44 million at end-March. Its prepaid customer base decreased 129,000 to 789,000.
Post-paid ARPU fell 9.3 per cent to SDG39, attributed to lower voice and data revenue, with prepaid stable at SDG13. Average smartphone data usage increased year-on-year to 6.3GB.
Capex amounted to SGD10.3 million, or 1.7 per cent of total revenue, excluding a spectrum payment of SDG282 million. This was below its guidance for 2019 capex at 11 per cent to 12 per cent of total revenue due to the timing of projects.
Based on the current outlook, the operator expects 2019 service revenue to decline 2 per cent year-on-year.Subscribe to our daily newsletter Back