StarHub profit falls 25% on higher costs

Singapore telco StarHub has posted 25% slide in earnings due to higher costs.

 

It boosted revenue 6.9% over the second quarter last year to S$569 million ($420m) and reported an S$58 million profit, but operating expenses increased 14%, the company said. 

 

Spending on bandwidth, services and equipment grew by more than a quarter to S$251 million, while sales costs as a proportion of revenue grew from 38% in the first half of last year to 44%, StarHub said.

 

“Despite increased competition on the pay TV front, our pay TV business remains stable and we look forward to offering new services when the Next Gen NBN is commercially launched,” said CEO Neil Montefiore.

 

“The investments in smartphones continue and we are beginning to see the benefits in the increase in revenue.”

 

Mobile revenue grew 8.2% and the pay TV business grew 9.0%, helped by the World Cup in June. However, broadband sales fell 1.8% despite a 4.8% increase in customers.

 

The company maintained its outlook of full-year revenue growth low single digit range and 28% ebitda.