AIS's profits hit by price war, as DTAC sees 4Q growth

28 Feb 2006

Thailand’s mobile market leader Advanced Info Services (AIS) has reported that the price war in the sector took a bite out of its profits last year. AIS posted net income of THB18.9 billion (USD482 million), a fall of 6.7% from 2004, on revenues which dropped by 4.6% year-on-year to THB92.5 billion (USD2.36 million). The company faces intensifying competition, with all Thai mobile players introducing aggressive tariff-cutting schemes during 2005, although it said that the fall in turnover was partly offset by lower tax bills as a result of booking pre-paid revenue only after customers activate their cards. It started the practice in the third quarter of last year; it previously recorded revenue when it sold cards to dealers. AIS had 16.409 million subscribers at the end of December.

AIS’s nearest rival, DTAC, which has yet to release its full-year 2005 financial results, posted a 13% rise in fourth quarter turnover, and a net profit jump of 39% in the same period, as its customer base grew to 8.677 million at the end of the year. After reporting 4Q revenues of THB11.1 billion (USD282 million) and net income of THB1.5 billion (USD38 million), DTAC revealed plans to invest THB12 billion (USD306 million) this year to expand its network. Third placed cellco True Move (formerly TA Orange) had 4.459 million customers at end-2005.

Thailand, Advanced Info Service (AIS)