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dtac reports Q316 net profit of THB659 million

October 20, 2016 – dtac reports total revenues and net profit for the third quarter of 2016 of THB19.5 billion and THB659 million, respectively.
     Postpaid subscriber base and revenues continue to grow strongly, with double digit growth rates for both, as a result of improving network quality and perception, best offers in the market, attractive handset campaigns, and expansion of dtac retail shops. dtac registered postpaid net adds of 195k subscribers and 14% growth of revenues from postpaid segment in Q316. Challenges remain in the prepaid segment, including ongoing handset subsidies in the market, aggressive MNP campaigns, and continuing trend of prepaid-to-postpaid subscriber migrating.
     Despite strong growth in the postpaid segment, total service revenues excluding IC for Q316 declined 1.2% from the same period last year. Revenues from data services continue to grow strongly, reaching 58% of service revenues excluding IC. dtac, with a strong spectrum portfolio of 50MHz bandwidth and the largest contiguous bandwidth in the 1800MHz frequency band, 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 continues its massive network rollout, installing close to 20,000 additional 3G/4G base stations during the last 12 months. At the end of the third quarter, dtac has all districts in Thailand covered with its 4G network. Moreover, bandwidth on 4G-1800MHz in densely populated areas across the country, in addition to the BMA, has been upgraded to 20MHz, the widest contiguous 4G bandwidth in a single frequency band in the market, to provide the best mobile Internet service. All customers with 4G-enabled devices are able to enjoy the best 4G experience on dtac network. More areas will be upgraded in the coming quarters. Along with the network expansion, the perception of network quality gradually improves. At the end of the third quarter, the number of 4G subscribers reached 4.1 million, up from 1.6 million a year ago. The total subscriber base stood at 24.8 million, more than 94% of which had already been registered under DTN.
     In addition to network expansion, we put significant efforts into expanding the distribution channels - both offline channels, including 55 new branded retail shops, and “dInfinite”, the digital service flagship store, and online channels, like the dtac official store on Lazada. The online channels are a very important part of becoming the leading digital brand.
     In Q316, facing a slight decline in total revenue from the same period last year, costs are well contained, resulting in an increase in EBITDA of 2%. EBITDA margin reaches the 2-year high level of 37.0%, compared to 35.9% in the same period last year. Depreciation and amortization expenses continue to go up due to continued investment in the network. Consequently, Q316 net profit declined 46% from the same period last year.
     We have revised our outlook for 2016 to reflect the actual results in the first 9 months of 2016. The outlook for 2016 comprises (1) slight decline in service revenue excluding IC from last year, (2) EBITDA at least at the same level as last year, and (3) similar CAPEX level as last year.
     Lars Norling, dtac’s Chief Executive Officer, said “We are pleased to see the strong growth in the postpaid segment, validating the improvement in network quality and perception, and distribution both online and offline. We continue to offer our customers the best Internet experience and maintain our value-for-money position. Furthermore, data revenue growth continues to accelerate, mainly driven by video and music streaming services. We have a strong spectrum portfolio and are well positioned to capture the data growth. After allocating 20MHz bandwidth of 1800MHz frequency band to provide the best 4G service in BMA, we have upgraded most of the densely populated areas across the country with 20MHz bandwidth on 4G-1800MHz and plan to upgrade more areas in the future. At the end of Q3, dtac’s 4G network covers all districts in Thailand.”