Research and Markets: MobileOne: MobileOne to Look at New Business Opportunities...

Research and Markets: MobileOne: MobileOne to Look at New Business Opportunities around NBN in Order to Alleviate Competitive Pressure

DUBLIN, Ireland--(Business Wire)--
Research and Markets
(http://www.researchandmarkets.com/research/c916c2/mobileone_mobileo)
has announced the addition of IE Market Research Corp.'s new report
"MobileOne: MobileOne to Look at New Business Opportunities around NBN
in Order to Alleviate Competitive Pressure" to their offering.

In this Competitor Insight, the author reviews MobileOne's 2Q.2008
results with a particular emphasis on MobileOne's vulnerability to
competitive pressures from SingTel and StarHub. The author believes
MobileOne has the least defensive earnings franchise among the three
Singapore telcos. The report sees key reasons for the vulnerability in
MobileOne's earnings as: concentration risk in the mobile business,
lack of scale and clear competitive advantages.

Our forecast for FY08 Dividend per Share (DPS) of S$0.15/share is
in-line with consensus. The implied payout ratio is 85% vs. management
guidance of 80%. The report sees limited scope for upside surprise on
the yield front as management is conserving cash for strategic
business opportunities post the expected National Broadband Network
(NBN) rollout in 2011.

The author sees the risk for MobileOne as a sustained market share
bleeding to its two larger rivals on the back of a structural shift in
buying behavior towards bundled purchase of telco services vs.
single-service purchases.

MobileOne's 2Q08 earnings trended down on Mobile Number
Portability (MNP) competition, while its subscriber market share
continued to decline. MobileOne's ARPU remained steady and the MNP
impact on churn rate was lower than management expected.

Key Topics Covered:

Executive Summary

MobileOne's weakening prospects are fairly well appreciated by the
market

MobileOne is the most vulnerable to competitive pressure as it
lacks diversification, scale and differentiation

Little yield upside over 12 months

-- Payout expectation of 85% vs. management guidance of 80%

-- Base case does not forecast any negative impacts on MobileOne
from NBN

-- Forecast of 10 year mobile revenue growth of 2.1%

-- Bull case sees MobileOne successfully reposition itself as a
service provider of fixed-broadband associated services post-NBN

-- Forecast of 10 year mobile revenue growth 3.1%

-- Bear case assumes MobileOne is unsuccessful at launching new
services post-NBN

-- Forecast of 10 year mobile revenue growth of 1.1%

-- Risks of sustained market share bleeding for MobileOne

MobileOne's 2Q.2008 earnings down, EBITDA margin falling due to
higher SAC and SRC

-- Revenues trended down on MNP competition

-- Subscriber market share continues to decline while ARPU remains
steady

-- MNP impact on churn rate lower than management expected

-- Management maintains guidance as it expects stability in 2-3
quarters

Charts:

Chart 1: EBITDA and EBITDA margins for MobileOne, 2003A - 2010F

Chart 2: Total Revenue Market Share (SingTel, StarHub, MobileOne),
1Q.CY04 - 1Q.CY08

Chart 3: EBITDA Margin (SingTel, StarHub, MobileOne), 1Q.CY04 -
1Q.CY08

Chart 4: Mobile Subscriber Market Share (SingTel, StarHub,
MobileOne), 1Q.CY04 - 1Q.CY08

Chart 5: Mobile revenue Market Share (SingTel, StarHub,
MobileOne), 1Q.CY04 - 1Q.CY08

Tables:

Table 1: Scenario analysis of MobileOne's Valuation per share, 10
year FCF yield, 10 year EBITDA CAGR

Table A1: MobileOne's Key Income Statement data, Key Cash Flow
data, Key Balance Sheet data, Business Performance, Quality of
earnings, 2006A - 2010E

Financial Summary:

Estimates of MobileOne's Net Income, EPS, EPS change (YoY), DPS,
Free Cash Flow per share, P/E, Dividend Yield, EV/EBITDA, Free Cash
Flow Yield, 2006A - 2010E

Companies Mentioned:

MobileOne

SingTel

StarHub

For more information visit
http://www.researchandmarkets.com/research/c916c2/mobileone_mobileo

Research and Markets
Laura Wood, Senior Manager
Fax from USA: 646-607-1907
Fax from rest of the world: +353-1-481-1716
press@researchandmarkets.com

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