StarHub reports 2Q21 net profit jumped 63 percent as service revenue improved

StarHub retail store at Singapore’s VivoCity mall; taken September 2018.StarHub retail store at Singapore’s VivoCity mall.

StarHub reported Thursday its second quarter net profit climbed 62.6 percent on-year to S$37.4 million, with all business segments reporting improved quarter-on-quarter performance.

Revenue for the April-to-June period increased 7.3 percent on-year to S$486.7 million, the mobile and payTV operator said in a filing to SGX.

Operating expenses increased 4.2 percent on-year in the second quarter to S$436.5 million, StarHub said.

For the first half, StarHub reported net profit of S$67.3 million, up 6.6 percent on-year, on revenue of S$973.7 million, up 1.5 percent on-year.

Mobile revenue falls

Mobile revenue for the first half fell 15.4 percent on-year to S$259.8 million on lower postpaid and prepaid revenues, StarHub said.

“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,” StarHub said. “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.”

The impact of Covid-19 on roaming revenue was for the full first half of 2021, while it only impacted four months of the year-ago period, with travel and movement restrictions beginning in March 2020, StarHub said.

Broadband

Broadband revenue for the period increased 12.5 percent on-year to S$95.5 million on higher average revenue per user (ARPU) on reduced subscription discounts and the absence of a one-time 20 percent rebate on monthly fees for a service disruption in April 2020, StarHub said.

Entertainment

Entertainment revenue, or service revenue from payTV, fell 3.4 percent on-year in the first half to S$90.5 million, due to a lower residential subscriber base, partly offset by higher ARPUs, StarHub reported.

The enterprise business, which includes network solutions, cybersecurity services and regional ICT services, posted first half revenue increased 12.9 percent on-year to S$333.6 million on higher contributions from managed services, cybersecurity services and the consolidation of Strateq under Regional ICT Services after its July 2020 acquisition, StarHub said.

First half operating expenses edged up 0.9 percent on-year to S$875.5 million, but excluding cybersecurity services and regional ICT, would have fallen 4.9 percent on-year.

StarHub declared an interim dividend of 2.5 Singapore cents a share for the first half. The company reiterated its guidance to distribute the higher of 5 Singapore cents or at least 80 percent of net profit as dividends for the full year.