StarHub profits leap 63% in 2006

15 Feb 2007

Singaporean telecoms operator StarHub has reported full year earnings of SGD360.2 million (USD234 million) in 2006, a 62.7% jump from SGD221.4 million the previous year, boosted by a tax credit and double digit growth across its fixed line, broadband, mobile and cable TV businesses. Full year operating revenue was SGD1.8 billion, up 14.9% year-on-year from SGD1.57 billion in 2005. EBITDA stood at SGD575.3 million, a 25% rise on the SGD460.1 million figure recorded in FY2005. In the fourth quarter of 2006 net revenues rose 14% to SGD473.2 million, generating net income of SGD141.7 million, up 93% from SGD73.3 million in Q2 2005. Quarterly EBITDA was SGD146 million, up 24.4% year-on-year.

The group’s broadband business was the top growth performer in 2006, at 24%, driven by a strong surge in customers and rising ARPU. The cable TV unit reported growth of 19%, partly the result of higher subscription revenues during the World Cup. The fixed line division posted growth of 17% while mobile maintained steady growth of 12%.

StarHub ended 2006 with 1.54 million mobile customers (+10% y-o-y), giving it a market share of 33.1%. Full year wireless revenues were SGD919.1 million, up from SGD821.6 million a year earlier. Contract revenues rose 6% to SGD704.3 million, accounting for 77% of the total. Post-paid ARPU was steady at SGD71, while pre-paid ARPU rose 13% to SGD27. The group’s cable TV business posted revenues of SGD313.2 million while broadband revenues increased 24% to SGD219.9 million on the back of a 17% rise in subscribers to 325,000 by the year end. Broadband ARPU also benefited, rising SGD2 to SGD59 and helping the company consolidate its 50.6% residential market share at 31 December. Elsewhere, the fixed line business reported a 16% rise in turnover to SGD259.5 million on the back of a higher volume of domestic and international leased circuits and higher IDD voice traffic.

Commenting on the financial performance Terry Clontz, CEO, StarHub, said: ‘We are pleased to report another year of strong results, underpinned by good business fundamentals. Our hubbing strategy continues to deliver value for consumers and shareholders alike. As always, the fourth quarter is seasonally impacted by festive promotions. However, as we expected, this fourth quarter showed a continuation of a more competitive market that began in the second quarter, particularly as we chose to respond more aggressively in certain business segments’. In 2007 the company plans to focus efforts on developing its broadband business and is looking at a revenue growth in the high single digits this year. The company also plans to review its capital structure, which includes refinancing the group’s debt, totalling some SGD633 million as at the end of 2006.

Singapore, StarHub