CFA Society Singapore
SINGAPORE (Feb 14): StarHub reported a 61.8% drop in 4Q18 earnings to $19.8 million from $51.8 million in 4Q17.
This brings FY18 earnings to $201.5 million, 26.2% lower than $273.0 million in FY17.
As of FY19, the group says it intends to adopt a new variable dividend policy and pay-out at least 80% of net profit attributable to shareholders, adjusted for one off, non-recurring items, as dividend.
As part of the transition to the new dividend policy, the group intends to pay a dividend of at least 9 cents per share for FY19, at a rate of 2.25 cents per quarter.
Any payment above 9 cents in line with the new dividend policy would occur in the last quarterly payment.
Total revenue for 4Q18 was 9.8% lower at $619.5 million from $686.9 million in the previous year, mainly due to lower revenue from Mobile, Pay TV, Broadband and Sales of equipment, partially offset by higher revenue from Enterprise Fixed services.
Mobile service revenue dropped 13.7% y-o-y to $194.3 million, attributable to 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.
Pay TV service revenue declined by 19.1% y-o-y to $71.3 million, mainly due to lower subscriber base.
Broadband service revenue decreased by 3.1% y-o-y to $45.7 million.
Enterprise fixed service revenue increased by 12.0% y-o-y to $146.1 million.
Revenue from sales of equipment declined by 17.3% y-o-y to $162.0 million, due to lower handset revenue.
Operating expenses was 4.2% lower at $590.1 million from $616.2 million last year, due to lower cost of sales and other operating expenses.
Other income was 27.6% lower y-o-y at $0.5 million.
Finance income dropped 52.0% y-o-y to $0.5 million, while finance expense increased by 11.5% y-o-y to $8.2 million.
The group has proposed a final dividend of 4 cents per share.
Peter Kaliaropoulos, CEO of StarHub, says, “As part of our transformation plan, driven by the ongoing requirements to deliver a better customer experience, we have introduced a simplification of our mobile plans with the launch of the “Hello Change” campaign. Additionally, we have lowered our TV subscription fees and enlarged the TV packs for key content such as HBO, to deliver even more value to customers. As we face increased competitive threats, we continue to seek operational efficiencies and overhaul processes to simplify products, offers and improve customer care.”
Shares in StarHub closed at $1.90 on Thursday.