Singapore operator StarHub’s net profit fell 2 per cent last year as broadband revenue dropped sharply, mobile revenue was flat and ARPU decreased across most services.
The operator’s net profit after tax in 2014 fell to SGD370 million ($272 million), while overall revenue inched up 0.7 per cent to SGD2.387 billion.
Service revenue was down 1 per cent to SGD2.217 billion, with mobile revenue up just 0.3 per cent to SGD1.24 billion and broadband revenue declining 17 per cent to SGD201 million as broadband ARPU dropped SGD8 to SGD36.
The broadband decline came despite a 5 per cent increase in its residential customer base, ending the year with 469,000 customers. The company said price competition lowered its subscription revenue from re-contracts and new customers.
StarHub, the second largest operator in the city-state, said overall revenue managed to increase slightly due to a 30 percent jump in equipment sales, which was driven primarily by strong demand for the new iPhones.
Its postpaid subscriber base increased 5.5 per cent to 1.27 million, accounting for 59 per cent of its total mobile customers. Its prepaid base decreased 24 per cent to 871,000. Postpaid ARPU fell SGD1 to SGD69, while prepaid ARPU also dropped by SGD1 to SGD17 as voice usage declined.
Pay-TV revenue was up 1 per cent to SGD389 million due to higher subscription revenue from a larger customer base, which grew almost 2 per cent to 542,000 households last year. Pay-TV ARPU was steady at SGD52.
Fixed network revenue increased 2.7 per cent to SGD378 million. Data and internet revenue, which account for 85 per cent of fixed sales, increased 6 per cent. Voice service revenue fell 11 per cent to SGD57.4 million.
The number of triple-play service households grew 6 per cent to 242,000 households, after adding 4,000 in Q4.
Its capex increased 6 per cent to SGD321.6 million last year and included a payment of SGD40 million for 4G spectrum rights.
The company’s EBITDA rose 1 per cent to SGD747.9 million. Its EBITDA margin as a percentage of service revenue was 33.7 per cent for the full year, up 0.5 points from 2013.
StarHub expects service revenue this year to grow in the low single-digit range and its EBITDA margin to be about 32 per cent. Capex is forecast to be about 13 per cent of total revenue, up from 13.5 per cent last year.