M1 announces SG$178.5 million profit for 2015

Singaporean telco M1 has marginally grown its net profit by SG$2.7 million for 2015, driven by a jump in its fibre broadband services revenue and customer base.

Singapore's third-largest telecommunications carrier, M1, has announced a full-year 2015 net profit of SG$178.5 million, a marginal 1.5 percent increase from 2014's SG$175.8 million, on operating revenue of SG$1.16 billion -- a 7.5 percent year-on-year rise from SG$1.08 billion in 2014.

The results [PDF], announced on Tuesday, also revealed earnings before interest, tax, depreciation, and amortisation (EBITDA) of SG$341.8 million, a 1.9 percent rise from the SG$335.5 million announced in 2014.

Its net assets totalled SG$385.2 million for the year, a 0.76 percent rise from 2014's SG$382.3 million.

Operating expenses also rose, however, from SG$857.1 million to SG$940 million due to the high cost of sales, which was attributed to higher handset costs, traffic expenses, wholesale costs of fixed services, and a greater fibre customer base.

Revenue from mobile telecommunications services fell slightly to SG$667.7 million, down 0.5 percent from the SG$671.1 million announced in 2014, while revenue from international call services dropped by 23.1 percent from SG$89.4 million in 2014 to SG$68.7 million in 2015.

Post-paid customers grew by 46,000 customers, from 1.149 million in 2014 to 1.195 million by the end of 2015. M1 also added 30,000 prepaid customers over the year, growing from 703,000 to 733,000. Its total mobile customer base now numbers almost 1.93 million, giving it a Singaporean market share of 23.3 percent.

Net average revenue per user (ARPU) for post-paid customers was SG$54.20, a drop of 2.5 percent from SG$55.60 in 2014. ARPU for prepaid customers, on the other hand, grew by 1.4 percent, from SG$14.50 in 2014 to SG$14.70 in 2015.

Mobile data now accounts for 46.3 percent of M1's service revenue.

On the other hand, revenue from fixed services grew by 21.7 percent, from the SG$70.6 million reported in 2014 to SG$85.9 million for 2015, while revenue from handset sales reached SG$334.9 million in 2015, a 36.6 percent jump from the SG$245.3 million in 2014.

The telco's fibre customer base rose by 25,000 customers, from 103,000 up to 128,000, while ARPU for its fibre broadband services rose by 6.4 percent year on year, from SG$43.90 up to SG$46.70.

The growth in fixed services was attributed to a larger residential customer base, as well as new corporate contracts secured during the year.

According to M1 CEO Karen Kooi, the burgeoning interest in video-streaming services will continue fixed services revenue growth in 2016.

"The entry of OTT content providers such as Netflix and Viu, offering a large library of on-demand content at low monthly subscription, will effectively unbundle content from access. This will further level the playing field," Kooi said.

Kooi also pointed towards machine-to-machine (M2M) technology as a growth enabler in future.

"Products and services are increasingly incorporating embedded sensors and connectivity," Kooi said.

"To capitalise on these opportunities, we will continue to develop our capability in data analytics with real-time feedback, and leverage on our M2M Connect platform to deliver smart solutions for our customers."

M1 also plans to invest in its network, including spending SG$64 million [PDF] in September 2016 during the auction for additional 4G spectrum.

M1 had announced a first-half net profit of SG$90 million for 2015, an increase of 3.8 percent year on year, with service revenue of SG$408.6 million, and a third-quarter profit of SG$44.9 million, a year-on-year increase of 0.8 percent, on operating revenue of SG$277.6 million.

Last week, M1 also announced that it attained 1Gbps download/130Mbps upload speeds on its 4G mobile network in Singapore in partnership with Chinese technology giant Huawei.

The trial was conducted inside of M1's LTE Advanced test lab, and attained through the combination of four network technologies: 4x4 Multiple-Input Multiple-Output (MIMO); two-component carrier (2CC) uplink carrier aggregation; 3CC tri-band downlink carrier aggregation; and Higher Order Modulation 256 Quadrature Amplitude Modulation (QAM).

The two companies used commercially available hardware as well as a prototype CAT14 Huawei device for the trial.

"Through technology innovation, we can further stretch the capability of current 4G technology, prior to the advent of 5G technology, to achieve an incredible peak download speed of more than 1Gbps," said M1 CTO Denis Seek.

"With more customers uploading and sharing content on social media and other channels, it is equally important to ensure we can deliver higher upload speeds. For this reason, we are also testing technology to deliver increased mobile upload speeds, to ensure we can meet their expectations."

Wang Jun, president of LTE Networks at Huawei, added that mobile networks are moving from 4G towards "4.5G" before the arrival of 5G in 2020.

"The successful trial marks the beginning of 4.5G era in Singapore, demonstrating Huawei and M1's continual innovation in delivering the benefits of the latest mobile technology advances to Singapore consumers, for instance, in enabling machine-to-machine connections and improving HD video experience," Wang Jun said.

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