Higher handset subsidies and base station related costs ate into mobile operator M1's profits, which fell 10 per cent to $146.5 million for the year ended Dec 31, 2012.
Full press release below:
SINGAPORE - M1 Limited (M1) today announced the unaudited group financial results for the year ended 31 December 2012.
Service revenue for FY2012 grew 2.8% to S$771.6 million, driven by growth in mobile customer base and higher contribution from fixed services. Net profit after tax for the full-year decreased 10.7% to S$146.5 million due to higher handset subsidies. However, net profit after tax for the latest quarter increased 14.4% quarter-on-quarter to S$37.9m, reversing the declines seen in the previous quarters. Free cash flow for FY2012 remained healthy at S$152.3 million.
Revenue from non-voice services rose 2.0 percentage points to 37.6% of service revenue, driven by continued growth in smartphone and mobile broadband customer base. Smartphone customers now accounts for 75% of total postpaid customer base.
During the quarter, M1 added 50,000 postpaid and prepaid customers, bringing the total mobile customer base to 2.109 million as at 31 December 2012. Monthly postpaid churn for the year remained stable at 1.3%. The fourth quarter also saw a strong take-up of smartphone plans with tiered data bundles and this trend is likely to continue in 2013.
With nationwide coverage of the Next Generation Nationwide Broadband Network and customers progressively completing their existing contract commitments, the adoption of fibre services is likely to accelerate in 2013 and M1 will continue to champion this service.
Based on current economic outlook and barring unforeseen circumstances, M1 estimates moderate growth in net profit after tax for the year 2103.
The Board of Directors has recommended a final dividend of 6.3 cents per share, and in addition, a special dividend of 1.7 cents per share, taking full year payout to 90% of net profit after tax for 2012.