StarHub posts 2.6% fall in Q1 net profit to S$29.7 million

MAINBOARD-LISTED StarHub’s net profit slipped 2.6 per cent to S$29.7 million in Q1 2022, down from S$30.5 million a year ago, the telco said in a bourse filing on Friday (Apr 29).

Revenue for the period ended Mar 31 was up 5.3 per cent to S$512.7 million from S$487.1 million the year before, on the back of service revenue growth of 10.7 per cent year on year (yoy).

All service segments reported revenue growth. Mobile segment revenue gained 3.8 per cent yoy to S$134.1 million, broadband revenue rose 9.6 per cent to S$51.5 million, while entertainment segment revenue increased 3.9 per cent to S$47.2 million.

Still, service earnings before interest, tax, depreciation and amortisation (Ebitda) declined 12.8 per cent to S$100.7 million yoy. The company attributed this to increased staff costs, higher occupancy costs and investments to streamline the company’s IT operations.

Meanwhile, Ebitda fell 11.1 per cent yoy to S$109.1 million due to higher utility costs as well as other investments as part of the company’s IT transformation plan.

At an earnings call on Friday, StarHub finance chief Dennis Chia said although inflation and higher fuel costs had made an impact, it was not as high as the company had expected.

For postpaid services, the company’s average revenue per user (ARPU) and subscriptions grew yoy to S$29 from S$27, and 1.5 million from 1.4 million subscribers, respectively. However, prepaid ARPU and subscriptions fell to S$8 from $10, and 517,000 from 534,000, respectively.

StarHub’s Q1 ARPU from its broadband segment rose to S$33 from S$31, while subscriptions fell to 484,000 from 495,000 a year ago. Meanwhile, the 3 months saw the quarter's entertainment segment ARPU fall to S$31 from S$36, even as subscriptions grew to 450,000 from 376,000.

As the acquisition of its 50.1 per cent stake in MyRepublic broadband business was only made on Mar 21 this year, the company said it would include the latter's financials starting in April.

Chief executive Nikhil Eapen said that the company intends to operate MyRepublic’s broadband business as a separate entity while opening up access to the company’s Infinity Play products.

“We try to achieve the best of both worlds with segmented strategies to different bases, but with products available to all,” he said.

StarHub shares closed 1.6 per cent or S$0.02 lower at S$1.26 on Friday, before the announcement.