M1's net profit down 27.1% to $31.8m in Q4

Blame the OTT services.

Over-the-top services continue to batter Singapore telco M1, with the latter posting a 27.1% decline in net profit to $31.8m in the past quarter.

Meanwhile, for the whole of 2016, net profit was down 16.1% to $149.7m, mainly due to lower international call and roaming revenues, as well as increased depreciation and amortisation expenses from higher fixed asset base in respect of 4G network, additional spectrum acquired, and new services.

M1's service revenue for the whole year decreased 2.0% to $805.5m, as traditional telecommunications services continued to be impacted by OTT services. On the other hand, fixed services continued to post strong growth with revenue increasing 21.4% to $104.2m, and this accounted for 12.9% of service revenue compared to 10.4% a year ago. The growth was driven by a larger base of residential, corporate, and government customers.

During the past year, M1 added 52,000 postpaid customers and 39,000 prepaid customers, to bring the total mobile customer base to 2.02m. Mobile churn was stable YoY at 1.0%. Data traffic continued to trend higher, with average postpaid smartphone data usage increasing to 3.6GB per month in 4Q16, from 3.3GB per month a year ago. Mobile data revenue increased 7.7% percentage points YoY to 54.0% of service revenue. M1’s fibre customer base also increased 32,000 during the year to 160,000.

“We continue to invest and innovate to enhance our service offerings to better serve our customers, as well as capitalise on new opportunities in the digital economy such as solutions for smart nation and IoT services,” said Ms Karen Kooi, Chief Executive Officer of M1.

She added, "These initiatives, together with the foundation that we have laid over the years, will enable us to create and deliver long-term value to our stakeholders."