SARS hits M1's Q2 - but H2 will improve

Singapore mobile operator MobileOne (M1) [MBNE.SI] reported profits of SGD31.4 million (USD17.9 million) for the three months to 30 June, down 4% on the same time a year ago, as market saturation and a decline in roaming traffic volume during the SARS outbreak combined to undermine its bottom line. Nonetheless, the operator is confident that with the epidemic controlled – and provided the economy remains stable – it will experience an improvement in performance in the second half of the year. M1 has reiterated that it is on track to post a low double digit earnings growth for the full year. The cellco, which is the second largest wireless player in an intensely competitive market, reported an upturn in roaming traffic in June and predicts it will be back on course by September. M1 added that its operating revenue increased by 2.5% to SGD177.8 million in the second quarter thanks in part to higher equipment sales and data revenues. GPRS usage is beginning to contribute strongly. The company said that 111,000 MMS-enable handsets had been sold by June this year and data derived from MMS leapt by 76% quarter-on-quarter. GPRS data jumped by 130% in the same period.