M1 2017 profits slid 11.5% to $132.5m

Its handset sales and mobile revenues remained weak despite higher services revenue.

Handset sales and weak mobile revenue continued to bite away M1's profits as they fell 11.5% YoY from $149.7m to $132.5m in 2017. For the fourth quarter of 2017, profits dipped 2.5% YoY to $31m.

According to its financial statement, handset sales continued to fall by 4.9% due to lower sales volume and selling price. International call revenue also fell 8.9% due to lower retail revenue. Singapore telcos continue to bow to price wars, which have significantly pulled down profits for all companies.

Meanwhile, its fixed services revenue leapt by 24.5% thanks to its higher customer base and corporate segment projects contribution, whilst its mobile revenue inched up 0.4% due to higher postpaid revenue.

M1 added 20,000 postpaid customers and 11,000 prepaid customers, to bring the total mobile customer base to 2.04 million. Mobile churn was stable QoQ at 1.2%.

Data traffic continued to trend higher, with average postpaid smartphone data usage increasing to 4.3GB per month in Q4 2017, from 3.6GB per month a year ago. M1’s fibre customer base also increased 7,000 during the quarter to 189,000.

Postpaid mobile revenue grew by 2.2% YoY from $570m in 2016 to $582m in 2017, whilst postpaid monthly average revenue per user (ARPU) fell by 3.8% YoY from $50.3m to $48.7m.

M1 reported that 81% of its postpaid customers are on tiered data plans and that 31% of them exceeded primary data bundles. This reflected in the rise of the data contribution to mobile service revenue from 54% to 55.7%.

M1 posted a final dividend of 6.2 cents per share, taking full-year payout to a total of 11.4 cents per share.

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