Singaporean fixed and mobile operator StarHub posted a net profit of SGD15.4 million (USD11.3 million in the fourth quarter of 2018, down 70% from SGD52.1 million in 4Q17 on total revenue of SGD619.5 million, which was down 10% from SGD686.9 million a year ago, as pay-TV revenue fell 19.1%, broadband revenue dipped 3.1% to SGD45.7 million and mobile revenue slipped 14% to SGD194.3 million. The telco reported that the fall in mobile revenue was the result of lower IDD, voice and data usage revenue, lower subscription revenue due to higher phone subsidies given to customers, and a higher mix of SIM-only plans. StarHub noted that monthly ARPU for post-paid users fell SGD3 quarter-on-quarter in October-December 2018 to SGD41. It was also forced to set aside provisions for customer loyalty programmes during 4Q18, as it expects redemption rates to rise. Overall service revenue, meanwhile, fell 7% from SGD491.0 million to SGD457.5 million and EBITDA slumped 22% y-o-y to SGD110.8 million, prompting the carrier to slash its dividends for FY 2019.
Group CEO Peter Kaliaropoulos said that while he understands investors’ hunger for dividends, StarHub needs to invest in more capabilities for the future. ‘Monetisation remains a challenge and we need to understand the realities of a saturated market in Singapore,’ he said. Further, in response to a question about the long-term outlook for StarHub’s consumer division, which generates roughly 60% of total revenue, he confirmed: ‘We don’t see consumer revenues growing dramatically, if at all’ and noted that its enterprise business offers more ‘high-value’ customers, although profit margins are typically lower. Mr Kaliaropoulos also confirmed that StarHub is open to network sharing agreements to reduce overheads. ‘We think the smart business model for the future is not building alternative infrastructure [which] very quickly gets commoditised … We should be coordinating with everyone at the infrastructure level. To build four 5G networks I think is very challenging, we look forward to working with one or two or any number of companies to make that happen.’
StarHub closed out 31 December 2018 with a total of 2.191 million mobile subscribers, down 5% from a restated 2.307 million twelve months earlier. Of the total, 1.402 million are post-paid users (-4%) and the remaining 788,000 on PAYG options (-16%). Average monthly pre-paid MOU dropped 17% to 14 minutes and contract MOU fell 4% to 167 minutes, it said. Post-paid churn was broadly unchanged at 1.1%. Turning to internet services, StarHub said the number of residential broadband customers stood at 482,000 at end-2018, up 3.2% on an annualised basis – although ARPU fell 0.9% to SGD32 per month. Fibre take-up accounted for 425,000 of the total, up 11.4% from 381,000 at 31 December 2017.