Starhub Ltd · SGX:CC3
Starhub — Q3 2017 Earnings Presentation
36 slides from Starhub's earnings presentation, Nov 2, 2017
Slide 1: StarHub 3Q & YTD-2017 Results
StarHub 3Q & YTD-2017 Results 2 November 2017
Slide 2: Forward-looking Statements
Forward-looking Statements The following presentation may contain forward-looking statements by StarHub Ltd (“StarHub”) relating to financial trends for future periods. Some of the statements in this presentation which are not historical facts are statements of future expectations with respect to th
Slide 3: Management Team
Management Team TAN Tong Hai CEO Dennis CHIA Howie LAU Dr CHONG Yoke Sin CFO CMO Chief, EBG 3
Slide 4: Agenda
Agenda 3Q & YTD2017 Highlights Financial Highlights Business Highlights 2017 Outlook 4
Slide 5: Overview (3Q-2017 vs 3Q-2016)
Overview (3Q-2017 vs 3Q-2016) ➢ Total revenue decreased 1% ➢ Revenue growth in Enterprise Fixed ➢ Service revenue stable ➢ Low churn rate maintained for Pay TV and Broadband ➢ EBITDA margin at 32.3% ➢ NPAT decreased 11% 5
Slide 6: Key Financial Highlights
Key Financial Highlights S$M 3Q-2017 3Q-2016 Change YTD-2017 YTD-2016 Change Total Revenue 580 585 -1% 1,752 1,762 -1% Service Revenue 545 546 0% 1,625 1,642 -1% EBITDA 176 179 -2% 517 554 -7% EBITDA Margin 32.3% 32.8% -0.5%pts 31.8% 33.8% -2.0%pts Taxation (17) (20) -11% (50) (61) -18% Net Profit A
Slide 7: Revenue Contribution
Revenue Contribution Quarter Ending 30 Sept YTD Ending 30 Sept 2017 2016 Incr / Incr / 2017 2016 Incr / Incr / (Decr) (Decr) (Decr) (Decr) Total Revenue S$m S$m S$m % S$m S$m S$m % Mobile services 297.0 299.4 (2.3) (0.8) 895.9 902.8 (6.9) (0.8) Pay TV services 85.7 93.6 (7.9) (8.5) 262.0 283.9 (21.9
Slide 8: Revenue Mix
Revenue Mix Quarter Ending 30 Sept YTD Ending 30 Sept 2017 2016 2017 2016 Revenue Mix % mix % mix % mix % mix Mobile services 51.2 51.2 51.1 51.3 Pay TV services 14.8 16.0 15.0 16.1 Broadband services 9.2 9.3 9.1 9.2 Enterprise Fixed services 18.8 16.8 17.6 16.6 Total Service Revenue 94.0 93.3 92.8
Slide 9: Financial Highlights
3Q & YTD2017 Highlights Financial Highlights Business Highlights 2017 Outlook 9
Slide 10: EBITDA & EBITDA Margin
EBITDA & EBITDA Margin (S$M) 33.8% 32.8% 32.3% 31.8% 554 517 179 161 180 176 136 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017 EBITDA Margin as % of Service Revenue * Numbers may not add up due to rounding. 10
Slide 11: Cost Of Sales
Cost Of Sales (S$M) 41% 40% 39% 39% 712 679 85 93 327 298 296 25 260 232 227 225 31 30 112 26 28 107 105 109 111 289 300 159 97 122 92 86 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017 Cost of Equipment Cost of Services Traffic Expenses Cost of Sales / Revenue * Numbers may not add up due to rou
Slide 12: Other Operating Expenses
Other Operating Expenses (S$M) 44% 43% 42% 42% 754 736 95 85 461 442 275 257 247 39 239 241 28 26 29 30 153 170 142 146 154 198 209 66 67 67 68 75 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017 Depreciation Other G&A Marketing & Promotion Operating Expense / Revenue * Numbers may not add up due
Slide 13: Net Profit After Tax
Net Profit After Tax (S$M) 287 235 86 86 77 73 54 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017 * Numbers may not add up due to rounding. 13
Slide 14: Capex (cash payments)
Capex (cash payments) 25.6% (S$M) 13.6% 11.5% 9.0% 240 201 150 126 115 52 34 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017 Capex / Revenue * Numbers may not add up due to rounding. 14
Slide 15: Free Cash Flow
Free Cash Flow (S$M) 253 229 117 120 16 2 4Q2016 3Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017 (45) * Numbers may not add up due to rounding. 15
Slide 16: Business Highlights - Mobile
3Q & YTD2017 Highlights Financial Highlights Business Highlights - Mobile 2017 Outlook 16
Slide 17: Mobile (3Q-2017 vs 3Q-2016)
Mobile (3Q-2017 vs 3Q-2016) ➢ Total customer base decreased 19k ➢ Post-paid ARPU stable at S$69 17
Slide 18: Mobile Customer Base
Mobile Customer Base (‘000) 2,275 2,307 2,291 2,290 2,256 902 920 898 905 895 40% 1,373 1,387 1,392 1,385 1,362 60% 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 Post-paid Pre-paid * Numbers may not add up due to rounding. 18
Slide 19: Post-paid Average Monthly Churn Rate
Post-paid Average Monthly Churn Rate 1.6 (%) 0.6 1.2 0.2 1.0 1.0 0.9 0.9 0.8 1.0 1.0 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017 Including one-time termination of 23k inactive legacy data-only lines 19
Slide 20: Mobile Revenue
Mobile Revenue (S$M) 902.8 895.9 299.4 311.8 296.2 302.7 297.0 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017 20
Slide 21: Mobile ARPU
Mobile ARPU Pre-paid (S$ per month) 16 15 15 15 16 15 14 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017 Post-paid (S$ per month) 69 70 67 70 69 70 69 21 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017
Slide 22: Business Highlights – Pay TV
3Q & YTD2017 Highlights Financial Highlights Business Highlights – Pay TV 2017 Outlook 22
Slide 23: Pay TV (3Q-2017 vs 3Q-2016)
Pay TV (3Q-2017 vs 3Q-2016) ❖ Revenue decreased 9% ❖ ARPU at S$51 ❖ Customer base decreased 40k 23
Slide 24: Pay TV Base & Churn
Pay TV Base & Churn (‘000) Customers 507 498 487 477 467 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 Average Monthly Churn Rate (%) 1.0 1.0 1.0 0.9 0.9 0.9 0.9 24 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017
Slide 25: Pay TV Revenue & ARPU
Pay TV Revenue & ARPU Revenue (S$M) 283.9 262.0 93.6 93.9 88.4 87.9 85.7 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017 ARPU (S$ per month) 51 51 51 51 51 51 51 25 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017
Slide 26: Business Highlights - Broadband
3Q & YTD2017 Highlights Financial Highlights Business Highlights - Broadband 2017 Outlook 26
Slide 27: Broadband (3Q-2017 vs 3Q-2016)
Broadband (3Q-2017 vs 3Q-2016) ❖ Revenue decreased 3% ❖ ARPU at S$37 ❖ Customer base decreased by 9k 27
Slide 28: Broadband Base & Churn
Broadband Base & Churn (‘000) Customers 475 473 470 467 466 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 Average Monthly Churn Rate (%) 1.1 1.1 1.0 1.0 1.0 0.9 0.9 28 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017
Slide 29: Broadband Revenue & ARPU
Broadband Revenue & ARPU Revenue (S$M) 162.6 159.7 54.7 54.2 53.7 52.8 53.2 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017 ARPU (S$ per month) 37 37 37 36 37 37 37 29 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017
Slide 30: Business Highlights – Enterprise Fixed
3Q & YTD2017 Highlights Financial Highlights Business Highlights – Enterprise Fixed 2017 Outlook 30
Slide 31: Enterprise Fixed (3Q-2017 vs 3Q-2016)
Enterprise Fixed (3Q-2017 vs 3Q-2016) ➢ Data & Internet revenue increased 13% ➢ Voice revenue stable 31
Slide 32: Enterprise Fixed Revenue
Enterprise Fixed Revenue (S$M) 307.3 292.8 107.2 109.4 98.4 98.7 99.2 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017 32
Slide 33: Voice/Data & Internet Revenue
Voice/Data & Internet Revenue (S$M) Voice 39.6 34.4 12.8 13.2 11.2 10.7 12.6 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017 Data & Internet (S$M) 272.9 253.2 85.6 94.0 87.5 88.5 96.9 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 YTD2016 YTD2017 33
Slide 34: 2017 Outlook
3Q & YTD2017 Highlights Financial Highlights Business Highlights 2017 Outlook 34
Slide 35: FY2017 Outlook
FY2017 Outlook ➢ Revenue: Maintain service revenue to be at about 2016’s level ➢ EBITDA: Maintain EBITDA margin on service revenue to be between 26 - 28% ➢ CAPEX: Expect CAPEX payment to decrease to 10% of total revenue (excludes spectrum payment) ➢ Dividend: Declare an interim quarterly dividend of
Slide 36: Investor Relations Contact
Investor Relations Contact Investor Relations Contact For IR-related queries, please email or call: Jeannie ONG Eric LOH Chief Strategic Partnership & IR Officer AVP, IR DID: +65 6825 5168 DID: +65 6825 5171 jeannieo@starhub.com / ir@starhub.com ericloh@starhub.com / ir@starhub.com 36