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StarHub posts 9.5% lower earnings of $40.2 mil in 3QFY21

Felicia Tan
Felicia Tan • 3 min read
StarHub posts 9.5% lower earnings of $40.2 mil in 3QFY21
The telco has upgraded its FY2021 service EBITDA guidance.
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StarHub has reported earnings of $40.2 million for the 3QFY2021 ended September, down 9.5% y-o-y.

This brings net profit to $108.2 million for the 9MFY2021, 11.2% lower y-o-y.

Excluding the effects of payouts for the jobs support scheme (JSS), net profit after tax attributable to shareholders (or earnings) increased 5.1% y-o-y to $40.0 million.

StarHub’s 9MFY2021 earnings – excluding JSS – rose 6.0% to $107.4 million.

See: StarHub acquires 60% stake in HKBN JOS in Singapore and Malaysia for $15 mil

3QFY2021 revenue improved 5.6% y-o-y to $517.2 million, while 9MFY2021 revenue rose 2.9% y-o-y to $1.49 billion.

See also: Japan Foods sinks into $0.5 mil net loss for FY2024

Segmentally, the telco saw lower mobile and entertainment revenue, while it registered increases in revenues for the broadband and enterprise segments.

In the 3QFY2021, mobile saw revenue of $133.3 million, down 0.6% y-o-y. Entertainment revenue fell 4.6% y-o-y to $45.0 million.

Meanwhile, broadband revenue rose 9.5% y-o-y to $49.8 million. Enterprise revenue was up 17.3% y-o-y to $190.0 million.

See also: Stamford Land FY2024 earnings shrink 96.1% y-o-y on absence of divestment gains

Network solutions in the 3QFY2021 fell 8.6% y-o-y to $90.1 million mainly due to lower revenues from data & internet and voice services.

Cybersecurity services rose 73.1% y-o-y to $79.3 million on stronger business demand.

Regional ICT services rose 16.5% y-o-y to $20.6 million; the FY2021 marks the first full year of the consolidation of Strateq.

At the same time, StarHub has increased its EBITDA margin guidance for the FY2021 to at least 26%, higher than the original 24% to 26% range.

This is due to the postponement of operating expenditure relating to the IT transformation programme and higher contributions expected from cybersecurity services.

In addition, StarHub expects to achieve “significant” operating expenditure reductions for the year due to its disciplined approach to expenditure and cost optimization initiatives.

As at Sept 30, StarHub has free cash flow of $348.6 million and a lower net debt to EBITDA of 1.27 times.

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“We continue to see top- and bottom-line growth in 3QFY2021, following the strong numbers recorded [in] the previous quarter. This reflects our differentiated strategy to drive enriching digital experiences for our consumers across mobile, broadband and entertainment, coupled with our focus on cybersecurity and ICT as key drivers of our enterprise business,” says StarHub’s CEO Nikhil Eapen.

“We also concluded our DARE programme, exceeding our initial cost savings target by 30%, giving us the confidence to upgrade our service EBITDA margin guidance and set the stage for DARE+,” he adds.

For more stories about where the money flows, click here for our Capital section

StarHub’s DARE+ programme seeks to create sustainable long-term revenue growth, while transforming the telco’s operating model and optimizing cost over time, continues Eapen.

Shares in StarHub closed 1 cent lower or 0.79% down at $1.26 on Nov 10.

Photo: StarHub

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