StarHub braces for a weak 2016 as service revenue disappoints

Its mobile revenue also contracted by 2.3%.

The telco giant is preparing for a quiet 2016 even while registering a modest profit last year.

According to a report by UOB Kay Hian, while post-paid revenue of StarHub expanded by 0.8%, prepaid revenue could have declined by a massive 18.7% yoy.

“StarHub gained 5,000 post-paid subscribers and post-paid ARPU increased S$1 qoq to S$72. Pre-paid ARPU decreased S$1 qoq to S$17 due to the decline in usage for iDD and SMS,” UOB Kay Hian said.

Meanwhile, StarHub is also bleeding in terms of pay-TV subscribers, losing 6,000 subscribers in 4Q15, the second consecutive quarter of attrition in its subscriber base.

“StarHub has stopped offering TV Lite which gives home broadband customers access to 16 free view channels at S$16.05/month. Fortunately, ARPU was stable at S$51,” StarHub said.

Meanwhile, UOB Kay Hian said StarHub guided low single-digit growth in service revenue in 2016.

“EBITDA margin is expected to come in at 31% (2015: 32.2%) after factoring in less adoption grants for NGNBN. Capex is expected to make up 13% of total revenue (excluding spectrum payment of S$80m),” the report said.

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