M1 profit and revenue up in Q2

21 Jul 2015

Singapore fixed, broadband and mobile operator M1 booked net income of SGD44.3 million (USD32.3 million) for the three months ended 30 June 2015, up 1% compared to SGD43.9 million a year before, on revenue that increased 15.5% year-on-year to SGD276.8 million from SGD239.7 million previously. The city-state’s third-largest telco by subscribers and revenue behind Singtel and StarHub said that its higher turnover was fuelled by a 137% increase in handset sales. However, the company – which is structured into four segments, namely: mobile services, fixed services, international services, and handset sales – said quarterly services revenue (which excludes handset sales) fell 2.3% compared to the second quarter of 2014, noting that handset sales inherently carry a lower profit margin than services revenue. The drop in service revenue came on the back of a 27% fall in its international call services revenue. Earnings per share flat-lined at SGD0.47, unchanged from Q2 2014, while capital expenditure of SGD40.0 million in Q2 2015 compared to SGD28.2 million in the corresponding year-earlier period.

In the second quarter, M1 added 13,000 net new mobile customers, bringing the total base to 1.88 million as at 30 June 2015. Monthly post-paid churn remained stable quarter-on-quarter at 1.0%, it said, although revenue from mobile services declined 0.7% y-o-y due to a 0.3% fall in the average revenue per user (ARPU). In addition, the company noted that average smartphone data usage increased from 2.8GB per month in 2Q14 to 2.9GB per month in the period under review, but data plan ARPU fell by 12.2% y-o-y due to M1’s moves to bundle its services with fixed line products. Staying with fixed services, the operator reported a 16% increase in revenue for this business segment, driven by a 21% rise (or 6,000) increase in fibre broadband subscribers to 114,000.

Singapore, M1 Limited (M1)