3 Min Read
(Adds details on voice and data revenue, company comment)
* Q1 net profit 9.48 bln baht vs forecast 9.24 bln
* Voice revenue down 12 pct on yr, non-voice up 25 pct
* Keeps 2014 revenue guidance on stronger growth momentum in H2
By Khettiya Jittapong
BANGKOK, May 6 (Reuters) - Advanced Info Service Pcl (AIS), Thailand's largest mobile phone operator, reported a better-than-expected 4.5 percent drop in first-quarter net profit on Tuesday, dragged down by weaker consumption and fierce competition after months of political unrest.
The Thai mobile sector, like many other consumption-related industries, has seen revenue suffer since political unrest began in November as delayed payments from a government rice-buying scheme and lower commodities prices have brought down consumer purchasing power.
Despite a 1.8 percent drop in first-quarter service revenue, the market leader has maintained its 2014 revenue growth forecast of 6-8 percent as it expects growth to accelerate in the second half, boosted by stronger network coverage, it said in a statement.
"With the lack of voice growth due to gloomy economic outlook and saturated market, revenue drivers depend more on rising adoption of smartphone users," AIS said.
AIS, 21 percent-owned by Singapore Telecommunications Ltd , posted a net profit of 9.48 billion baht ($293 million) for the January-March quarter, down from 9.92 billion a year earlier. The results beat the 9.24 billion baht average forecast by 11 analysts polled by Reuters.
In the next 12 months, AIS is expected to post an 8-8 percent growth in net profit, the slowest among Thai telecoms, according to StarMine SmartEstimates.
AIS has been aggressively expanding its network, while marketing costs remain high as the market leader wants to migrate subscribers to a new 3G network. Migrating customers would help boost revenue from data services, its key growth driver, and help offset drop in voice revenue.
First-quarter voice revenue dropped 12 percent from a year earlier, while non-voice revenue surged 25 percent, mainly due to higher sales of smartphones that boost usage of mobile data.
Last week second-ranked Total Access Communication Pcl cut its revenue growth guidance to "a low single digit" from 3-5 percent due to the impact of political unrest, a weakened economy and competition.
AIS shares, valued at $22.5 billion, have risen 17 percent in the past three months, outperforming an 11 percent of the broad Thai index. Before the earnings announcement, the stock was 2.45 percent lower.
$1 = 32.37 Thai baht Additional reporting by Patturaja Murugaboopathy in BANGALORE; Editing by Matt Driskill