Singapore, 11 May 2023 – StarHub reported today net profit attributable to shareholders (“NPAT”) of $37.5 million for the three-month period ended 31 March 2023 (“1Q2023”). This marks a 26% year-on-year (“YoY”) increase from $29.7 million in the equivalent quarter a year ago (“1Q2022”), due mainly to growth registered across all segments, contributing to higher profit from operations achieved.
Commenting on the results, StarHub’s Chief Executive, Nikhil Eapen, said, “Our 1Q2023 performance marks a strong start to the year, running ahead of our FY2023 guidance. We continue to deliver new digital and cloud-enabled products and platforms, strengthening our Infinity Play and All-in-One App proposition for consumers; as well as new Enterprise solutions converging the 3C’s to deliver smart, safe and sustainable solutions for Singapore and beyond. We are on track with our DARE+ transformation, reiterating our operational and financial goals and intend to accelerate into FY2023 to harvest DARE+ benefits from FY2024 and onward.”
Service Revenue grew 11.0% to $461.6 million in 1Q2023 compared to $416.0 million a year ago, lifted by a 13.5% segment revenue growth in Mobile; 20.4% for Broadband; 21.0% for Entertainment; and 3.9% for Enterprise. Total Revenue grew 8.7% to $557.4 million in 1Q2023 from $512.7 million in 1Q2022. Excluding the consolidation of MyRepublic Broadband[1], 1Q2023 Total Revenue and Service Revenue still grew 5.2% and 6.8% YoY, respectively.
The topline growth was backed by healthy operating metrics where ARPU grew YoY across most segments despite sustained intense market competition. Enterprise growth was lifted by an 8.3% growth in Network Solutions, driven by higher Data & Internet contributions (partly due to the consolidation of MyRepublic Broadband) and more project completions for the Managed Services segment; and a 3.6% growth in Cybersecurity Services; offset by a 4.0% decline in Regional ICT Services revenue in the absence of a major project delivered in 1Q2022.
Comparing against a full-year guidance for FY2023 released in February 2023, the 1Q2023 Service Revenue growth of 11% exceeded the guided 8% to 10% YoY growth range. Similarly, the 22.4% Service EBITDA margin recorded in 1Q2023 was higher than the “approximately 20%” guidance. Capex Commitment for 1Q2023 was 3.1% (including investments[2]), lower than the guided range of between 13% and 15% of Total Revenue. The Group reiterates its FY2023 guidance as it continues to execute on its DARE+ growth and transformation programme.
The Consumer business continues to leverage its Infinity Play proposition comprising a growing portfolio of products and services across six verticals[3] for differentiation, service penetration and to drive greater consumption amongst customers. This strategy has allowed StarHub to stabilise and improve its ARPU across its key business segments.
Over the last quarter, StarHub has added new Infinity Play products to fuel growth – such as the launch of the 10Gbps UltraSpeed plan (Singapore’s first 10G-XGS-PON nationwide trial) to encourage migration towards the higher-bandwidth Broadband plans; as well as continuous enhancement of its content offerings for the Entertainment business, especially for the sports category, where it has observed strong take-up of additional Entertainment passes and sports content packages from Premier League subscribers. Meanwhile, StarHub continued to record robust growth in 5G subscribers alongside nationwide 5G coverage achieved.
All of StarHub’s Infinity Play offerings will eventually be available on the All-in-1 app that will continue to see phased releases across FY2023. By end-2023, customers will enjoy a frictionless and convenient digital experience, as well as dynamic personalisation on their app; while StarHub will be able to leverage enhanced targeting, improved analytics and new marketing automation to digitalise its operating model, accelerate time-to-market and tap data insights for smarter and more agile decision making.
The Enterprise business has made headway in positioning itself as a Smart City Service Provider, having secured a multi-year network servicing contract awarded by JTC for Punggol Digital District (“PDD”), Singapore’s first smart and sustainable business district. StarHub will build in PDD an intelligent software-defined network integrated with 5G and network automation for data centre, campus and sub-systems network. This is differentiated with location-based analytics and network telemetry for digital twin, while the network operations and maintenance will be automated with artificial intelligence operations with security by design.
PDD will set the benchmark for smart and sustainable business districts in Singapore, and this is congruent with StarHub’s vision to provide smart, safe and sustainable solutions for Enterprises. This highly-scalable model can be the blueprint architecture for new smart cities and districts, as StarHub continues to work alongside PDD to co-create green, safe and sustainable use cases riding upon its Cloud Infinity and 5G backbone.
[1] Consolidation of MyRepublic Broadband with effect from 2Q2022.
[2] Excluding 5G Capex and spectrum right, but including investments relating to DARE+ and IT Transformation
[3] The six verticals are Mobile, Broadband, Entertainment, Safety Suite, GameHub+ and LifeHub+.
