Regulatory changes impacted the prepaid mobile customer base of Singapore's telecommunications provider M1 in what was an otherwise strong annual result driven by growth in its post-paid and fixed customer base.
The company reported a boost of 9.7 percent in net profit after tax for the year ending December 31, 2014, to S$175.8 million, compared to the previous year's S$160.2 million.
M1, launched in 1997 to become the second full service telco in Singapore after SingTel, saw its mobile telecommunications revenue grow by 4.2 percent to S$671.1 million.
While the company gained approximately 19,000 new post-paid customers for its mobile service, it lost about 276,000 prepaid customers, driving its overall customer tally down by 12.2 percent to 1,852,000.
The company said this drop in prepaid customers was due to regulatory changes that took effect in April 2014, altering the number of prepaid SIM cards per subscriber.
M1 also saw a 21.6 percent fall in revenue from its international call services, dropping to S$89.4 million from its previous full-year total of S$114 million.
Additionally, M1's fibre customer base grew by 18,000 people to 103,000 customers.
M1 told shareholders in a statement that it expected to see moderate growth in net profit after tax for the year ending 2015, with the company's CEO Karen Kooi Lee Wah suggesting that faster network and devices would drive more data usage in 2015.
"We are also well placed to capture growth in the corporate segment through our enhanced offerings, such as our new state-of-the-art datacentre and suite of cloud solutions," said Kooi. "In December 2014, we launched Singapore's first next-generation 4G network, enabling download speed of up to 300Mbps.
"We will continue to invest in our networks to improve customer experience," she said.
The results come as the company was let off the hook by the regulator Infocomm Development Authority of Singapore (IDA) for a five-hour service outage on February 4 last year, which left customers unable to make or receive calls or send and receive text messages.
M1 was not deemed responsible for the service disruption, because the cause was an "unknown" software bug in the call-processing software, and was "not within M1's control", the IDA said in a statement earlier this month.
In its most recent financial results, released in November last year, rival SingTel posted a net profit growth of 19.3 percent to S$1.04 billion (AU$950 million) in its second-quarter results, boosted by "strong performance" across its business units.