July 12, 2016
– dtac reports total revenues and net profit for the first half of 2016
of THB41.5 billion and THB1.4 billion, respectively,
and declares a dividend payment of THB0.42 per share. Postpaid
subscriber base and revenues continue to grow strongly as a result of
improving network quality and perception, best offers in the market,
attractive handset campaigns, and expansion of dtac retail
shops. In Q216, dtac registered postpaid net adds of 191k subscribers
and 9.2% growth of revenues from postpaid segment. The prepaid segment
has been facing several challenges, including widespread handset
subsidies, aggressive Mobile Number Portability campaigns,
and continuing trend of prepaid subscribers migrating to postpaid.
Despite strong growth in the postpaid segment, total service revenues
excluding IC for H116 declined 2.2% from the same period last year.
Excluding the impact from accounting adjustment of
prepaid revenue in Q216, the decline of total service revenues
excluding IC during H116 would have been 1.7%. Revenues from data
services, representing 54% of service revenues excluding IC in H116,
continue to be the main growth driver. dtac, with a strong
spectrum portfolio of 50MHz bandwidth, is well positioned to capture
the growth of data demand and provide best wireless services to its
customer base on 2G/3G/4G technologies.
dtac
installed 17,388 additional 3G/4G base stations during the last 12
months. At the end of Q216, dtac’s 4G service covered all 77 provinces
and is on track to cover all 878 districts in
Thailand by the end of Q316. On 4G-1800MHz, additional 5MHz of
bandwidth has been reallocated from 2G service in BMA, resulting in dtac
having the widest contiguous 4G bandwidth on a single frequency band.
All customers with 4G-enabled devices are able to
enjoy the best 4G experience in the market. In addition, network
quality and perception have gradually improved along with the expansion
of the network. As a result, the number of 4G subscribers increased to
3.5 million at the end of Q216 from 1.3 million
a year ago. The total subscriber base stood at 25.0 million, more than
92% of which had already been registered under DTN. Besides network
improvements, dtac launched ‘dtac Music Infinite’ and the ‘dtac prepaid’
brand to offer attractive and relevant services
for digital lifestyles. New products and services will be launched on a
regular basis to help dtac become the No. 1 digital brand in Thailand.
In
Q216, dtac increased spending on prepaid handset subsidies to defend
market position. Furthermore, selling, marketing and general
administrative expenses, excluding the one-time restructuring
cost, were well under control despite the high level of competition.
Cost of services also declined from lower regulatory costs, which was
partially offset by higher network OPEX. As a result, EBITDA margin for
the first half of 2016 went up to 33.6%, compared
to 31.5% in the same period last year. Moreover, depreciation and
amortization expenses went up due to continued investment in the
network. Consequently, H116 net profit declined 62% from previous year.
We
have revised our outlook for 2016 to reflect the actual results in
H116. The outlook for 2016 comprises (1) slight decline in service
revenue excluding IC from last year, (2) EBITDA margin
in the range of 31-33%, and (3) similar CAPEX level as last year.
Lars Norling,
dtac’s Chief Executive Officer, said “We are pleased to see the
continuation of strong growth
in the postpaid segment. This reflects the improvement in network
quality and perception, and our efforts to offer customers the best
Internet experience, attractive and relevant digital services, and
value-for-money. In addition, data revenue growth has also
accelerated, mainly driven by video and music streaming services. We
have a strong spectrum portfolio and are well positioned to capture the
data growth. Moreover, we have allocated 20MHz of 1800MHz frequency
band, the largest in the market, to provide 4G
service in BMA, and plan to expand the 4G network to cover all 878
districts in Thailand in order to serve the strong growth in demand for
mobile Internet. In addition, we will maintain our value-for-money
position on price plans, topping packages, and handset
deals.
