StarHub first-half profit falls 41.7% to $47.9m; telco eyes ‘more aggressive stance’ amid competition
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StarHub's CEO said the telco intends "to remain aggressive across brands and segments in the domestic consumer market to position for eventual market recovery."
PHOTO: STARHUB
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SINGAPORE - StarHub on Aug 14 reported a net profit of $47.9 million for the first half ended June, sliding 41.7 per cent from $82.1 million in the corresponding year-ago period.
The drop included a one-off forfeiture payment of $14.1 million for the return of certain spectrum rights.
Earnings per share dropped 43.8 per cent to 2.6 cents, from 4.6 cents in the year-ago period.
StarHub on Aug 12 announced the purchase of the rest of MyRepublic’s broadband business
This came a day after an end to long-time speculation about StarHub acquiring M1, when Keppel proposed the sale of its telco business to Simba Telecom. Shares of StarHub fell as much as 6.6 per cent that day in response to the news.
StarHub’s drop in earnings comes despite revenue rising 2.2 per cent to $1.13 billion in the first half from $1.1 billion, thanks to higher contributions from its broadband, regional enterprise and cyber-security services. Revenue from these segments rose 4.4 per cent, 6.8 per cent and 20.1 per cent, respectively.
The group’s regional enterprise business added 6.8 per cent year on year to $296.1 million in revenue, from $277.3 million. This was due to a 12.8 per cent growth in managed services, reflecting higher project completions from StarHub’s modern digital infrastructure solutions.
This was offset by a drop in entertainment service revenue of 9.1 per cent, mainly due to a reduction in subscribers, and a 2.9 per cent fall in revenue from sales of equipment, mainly due to longer device replacement cycles that resulted in lower volume of handsets sold.
Mobile subscribers rose 8.2 per cent, excluding the impact of a one-time consolidation of inactive prepaid subscribers.
To maintain its competitive agility, StarHub said it is retaining strategic flexibility to adopt a more aggressive commercial stance in the second half of 2025.
Chief executive Nikhil Eapen said eroding prices have challenged industry sustainability, but StarHub still managed to extend its No. 2 position behind Singtel in the mobile segment.
“We intend to remain aggressive across brands and segments in the domestic consumer market to position for eventual market recovery,” he added.
This more aggressive stance means StarHub’s earnings before interest, depreciation, taxes and amortisation outlook for the financial year 2025 have been revised down to between 88 per cent and 92 per cent of the 2024 figures.
“This revision reflects a deliberate strategic decision to preserve competitiveness and defend market share, while continuing to invest in long-term growth levers,” said StarHub.
The company has declared an interim dividend of three cents per share, unchanged from the year-ago period. It will be paid on Sept 5.
The company previously guided for a full-year dividend per share of at least six cents in 2025.
It noted that free cash flow might be temporarily affected by the one-off spectrum payment, but expects positive free cash flow trends from financial year 2026.
Shares of StarHub dropped 0.8 per cent to $1.18 as at 10.40am on Aug 14. THE BUSINESS TIMES
