Local telco StarHub announced that its 1HFY2021 ended June earnings came in at $67.9 million, some 12.3% lower than $77.4 million in the previous year. This was mainly due to a decrease in other income.
Excluding the effect of the JSS, underlying net profit would have risen by 6.6% to $67.3 million, from $63.2 million a year ago.
Total revenue for the period was 1.5% higher at $973.7 million from $959.6 million last year, mainly due to higher contributions from Broadband, Enterprise Business and Sales of Equipment, offset mainly by lower revenues from Mobile and Entertainment.
Against the corresponding period last year, Mobile service revenues was 15.4% lower, due to lower postpaid and prepaid revenues. The decrease in postpaid revenues was due to lower IDD, lower excess data usage, lower voice usage, lower VAS (value-added services) revenues and lower roaming, partially offset by the increase in SMS usage and higher plan subscriptions. The decrease in prepaid revenues was due to a decline in the number of tourists and foreign workers from sustained travel restrictions, lower data subscriptions, lower prepaid expired credit and lower IDD.
See also: StarHub launches free 5G standalone market trial
Notably, the impact of Covid-19 on roaming revenues was for the full six months in 1HFY2021, compared to four months in 1HFY2020, as global travel and movement restrictions commenced in March 2020.
Broadband service revenue increased 12.5% y-o-y, due to higher ARPUs from reduced subscription discounts and the absence of a one-time 20% rebate on Home Broadband monthly fee extended to customers for a service disruption in April 2020. Excluding the one-time rebate from prior year, revenue would have been $9.1 million or 10.5% higher y-o-y in 1HFY2021.
Entertainment service revenue decreased 3.4% y-o-y, due to a lower residential Pay TV subscriber base, offset by higher ARPUs from the increased price in HomeHub bundled plans, lower commercial TV revenue and lower spending on advertising by business customers.
Enterprise Business revenue increased 12.9% y-o-y, due to higher contributions from Managed Services, Cybersecurity Services and the consolidation of Strateq under Regional ICT Services (acquired on 30 July 2020). This was partially offset by lower revenues from Data & Internet and Voice Services.
Revenue from Sales of Equipment increased 8.8% y-o-y, mainly due to customers upgrading to 5G handset models, resulting in higher volume of premium handsets sold.
Other income was 65.8% lower y-o-y at $6.4 million from $18.8 million, mainly due to lower Job Support Scheme (JSS) payouts since 2QFY2020, partially mitigated by higher recovery of tunnel fees from TPG and higher income grant. The JSS payouts recognised in 1HFY2021 was $1.2 million compared to $15.7 million in the corresponding period last year.
The board has declared an interim dividend of 2.5 cents.
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Nikhil Eapen, CEO of StarHub says, “We are pleased to report q-o-q growth across all our key segments in 2QFY2021 although market competition remains intense and business conditions are still challenged with Covid-19. We see early results from driving a differentiated strategy that delivers real value to our customers lives.”
“Our focus is to enrich customers’ connectivity experiences across 4G, 5G and home broadband with entertainment offerings from OTT partnerships such as Disney+, to our partnership in cloud gaming with NVIDIA GeForce NOW. This drives our premium standing with customers, with highest customer satisfaction scores in CSISG and our rating by Opensignal as an outright winner in Video Experience and Download Speed Experience.”
“With enterprise customers, we continue to enable their own transformation efforts across Cybersecurity Services, Regional ICT and Network Solutions. Our Enterprise business similarly achieved top positioning with customers and strong double-digit growth,” adds Eapen.
Shares in StarHub closed at $1.24 on Aug 5.
Photo: Bloomberg
