Singaporean telco StarHub booked net profit of SGD109 million (USD81 million) for the three months ending 30 June 2016, representing a 10% improvement from SGD99 million in the corresponding period a year ago, although total revenue dipped 1% year-on-year to SGD586 million as a result of lower equipment sales. The firm noted, however, that a fall in handset sales also brought operating expenses down by SGD1.4 y-o-y to SGD468 million. Total service revenue, which strips out equipment sales, was broadly flat at SGD554 million, with StarHub reporting that lower mobile revenue and pay-TV returns were largely offset by higher broadband and enterprise fixed service revenue. Turnover derived from mobile operations declined to SGD305.3 million in 2Q16, down 1.8% y-o-y, which the company noted reflected lower usage of roaming and international direct dialling (IDD) services. The dip in sales was aided by higher subscription revenue though, as StarHub added a net 37,000 mobile connections in the quarter for a total of 2.235 million. Within this figure, some 20,000 were net gains for its post-paid user base, which increased to 1.364 million at the same date – equivalent to 61% of the total base. Contract ARPU was SGD71 for the period under review, or SGD1 higher than in 2Q15, as data usage increased to an average per subscriber of 3.3GB per month – fuelled by video streaming apps.
In terms of StarHub’s fixed broadband activities, the unit is struggling to make headway in 2016. The total number of high speed internet subscribers fell by a net 3,000 in Q1 and failed to recover in April-June, standing unchanged at 473,000, with churn increasing to 1.2% from 0.9% in 2Q15. Residential broadband ARPU climbed, however, to SGD37 per month, compared to SGD33 in the year-ago period. Second-quarter pay-TV revenue fell 2% to SGD95 million on a shrinking customer base (down 27,000 to 518,000).
StarHub is 55.81%-owned by Asia Mobile Holdings, a venture which includes Ooredoo (formerly Qatar Telecom) and Singapore Technologies Telemedia (STT).
As previously reported by TeleGeography’s CommsUpdate, rumours are circulating that Qatari-owned Ooredoo is considering divesting its stake in StarHub, with unnamed sources suggesting it is working with HSBC Holdings to measure the market’s appetite for a stake in Singapore’s second largest player. Ooredoo controls a roughly 25% equity interest in Asia Mobile Holdings, giving it an indirect 14% of StarHub. The Qatar-based telco is reportedly looking to concentrate its focus on its core assets in the Middle East and in faster growing markets. By contrast, the mature city-state is, by and large, stagnant in terms of growth, and the upcoming auction to determine a fourth operator is only likely to intensify competition and potentially squeeze profits.