SINGAPORE (April 17): M1 posted a 14.6% decline in net profit to $36.3 million for the first quarter ended March 31, from $42.5 million a year ago.
EBITDA fell 5.1% in 1Q17 to $79.0 million, compared to $83.3 million in the corresponding period last year.
Operating revenue grew 1.2% to $260.7 million, but was outpaced by operating expenses which rose 4.3% to $214.1 million.
Total service revenue dipped marginally by 0.9% to $201.5 million on the back of a 3.6% decline in mobile telecommunications services to $157.5 million and a 10.7% decline in international call services to $13.9 million.
This was partially mitigated by a 22.8% increase in its fixed services segment to $30.0 million. Driven by increased residential and corporate signups, the segment now accounts for 14.9% of M1’s overall service revenue.
Meanwhile, handset sales grew 9.2% to $59.2 million.
M1 reported that its customer base grew to 2.2 million as at March 31, some 6.6% higher than a year ago. However, customer acquisition cost increased by 14.0% in 1Q17 to $366.
Staff costs increased 9.3% to $29.9 million on the absence of higher wage credits that M1 had benefitted from in 1Q16.
Depreciation and amortisation expenses at increased 4.3% to $31.7 million due to a higher fixed asset base.
Finance costs increased 59.0% to $2.0 million due to higher borrowings and interest rate.
FY17 capex is expected to be around $150 million.
Cash and cash equivalents stood at $7.5 million as at March 31, 2017.
M1 CEO Karen Kooi said M1 had secured 2 x 10MHz of 700MHz and 2 x 5MHz of 900MHz spectrum at the recent General Spectrum Auction, which will enable it to “deliver an enhanced network experience cost effectively with optimal use of spectrum”.
“We are introducing improved cloud-based service offerings to drive growth in fixed services, and developing new Internet of Things and Smart Nation capabilities and solutions,” she adds.
Shares of M1 closed 1 cent higher at $2.14 on Monday.
