Singapore’s second largest mobile operator StarHub reported a double-digit drop in profit for Q1 2017, with revenue across three of its four business units down or mostly flat.

The operator’s net profit for the quarter dropped 21.3 per cent year-on-year to SGD73.1 million ($52.3 million). It attributed the decline to increased handset subsidies (up 16.9 per cent year-on-year) and higher cost of services for TV and broadband (up 13 per cent).

Total revenue inched up 0.2 per cent to SGD592 million, with a 13.7 per cent increase in equipment sales to SGD55.3 million helping to offset a 1 per cent decrease in service revenue to SGD537 million.

Mobile revenue slipped 0.6 per cent to SGD296 million, accounting for half of total service revenue. An increase in subscription revenue from higher take up of 4G tiered plans and rising data usage couldn’t fully make up for declines in voice, long-distance and roaming revenue, the company said.

Pay-TV turnover fell 6.8 per cent to SGD88.4 million, which was primarily due to its smaller subscriber base – down 7.7 per cent year-on-year. Broadband revenue rose 0.5 per cent to SGD53.7 million and enterprise fixed sales increased 2.9 per cent to SGD98.7 million.

The operator, with a 27 per cent market share, said the number of customers with three or more services (so-called hubbing households) dropped by 12,000 year-on-year to 338,000 at end-March, due mainly to higher churn in pay-TV households.

Expanding base
Over the past year, StarHub’s mobile user base increased 4 per cent to 2.3 million, with post paid and prepaid subs rising 3.5 per cent and 5 per cent year-on-year respectively in the quarter.

Prepaid ARPU dropped 12 per cent from a year ago to SGD15.00, while post paid ARPU was down 3 per cent to SGD67.00.

For the full year the company expects service revenue to remain at last year’s level and capex, excluding a spectrum payment of SGD350 million, to be 13 per cent of total revenue.