Dtac profit falls 8.8% in Q3

Thailand’s Dtac has reported an 8.8% year-on-year decrease in net profit for the third quarter of 2017 as a result of declining revenue and costs associated with network investment.

The operator reported a profit for the quarter of 601 million baht ($18.1 million), from 3.7% lower revenue of 18.81 billion baht. Service revenue fell 1.5% year-on-year to 15.96 billion baht.

Voice revenue fell 36% year-on-year to 3.52 billion baht due to ongoing voice to data substitution, while data revenue increased 19% year-on-year to 11.15 billion baht. Handset and starter kit sales meanwhile fell 6% year-on-year due to controls on handset subsidies.

Dtac’s total customer base meanwhile fell 6.9% year-on-year to 23.1 million, with postpaid net additions reaching 134,000 while prepaid subscribers fell by 642,000.

The operator’s bottom line was also impacted by higher network opex and depreciation costs associated with its network rollout. Total cost of services increased 3.4% year-on-year to 10.97 billion baht and network opex grew 9% over the same period to 1.69 billion baht.

For the full year, Dtac has maintained its outlook of flat service revenues and an ebtida at least as high as in 2016. The company expects its total capex for the year to be in the range of 17 billion to 20 billion baht.

“Market competition is expected to remain intense. Attractive handset offerings continue to be employed to attract high value customers, and prepaid handset subsidies are expected to persist although at a less aggressive level,” Dtac said in its third quarter report.

“Data services remain a growth driver thanks to higher demand from the growth of streaming services and superior 4G experience… We aim to gain consumers’ confidence with improving data network, digital products and services, and value for money position, and become [the top] digital brand in Thailand by 2020.”