Singapore M1 2Q07 Net Profit S$40.6 Million Vs S$36.9 Million

SINGAPORE -(Dow Jones)- MobileOne, Singapore's smallest mobile telephone operator by customers, Tuesday reported a 10% rise in second-quarter net profit due to increased numbers of subscribers, a rise in the use of non-voice services and lower taxes.

M1 said net profit for the three months ended June 30 rose on year to S$40.6 million from S$36.9 million.

Revenue in the quarter rose 4% to S$199.8 million from S$192.1 million the previous year.

The figures were broadly in line with those in a Dow Jones Newswires poll which forecast, on average, M1's net profit at S$38.7 million from revenue of S$197.2 million.

The company said it is giving shareholders an interim dividend of 2.5 Singapore cents per share and a cash distribution of 4.6 Singapore cents per share, maintaining its policy of giving shareholders at least 80% of its full-year net profit.

In a briefing, M1 Chief Executive Neil Montefiore said he is expecting that profit to show "single-digit growth" from last year's figure of S$164.6 million.

The company added 31,000 subscribers during the second quarter, raising its total customer base to 1.4 million, despite a fall in its market share.

In a statement, M1 said its share in the mobile market dropped to 28.4% from 29.3% last year, though the mobile penetration rate in Singapore rose to 109.5% from 99.3%.

M1's average monthly revenue for post-paid subscribers rose to S$62.20 from S$60.40 last year, as customers used more data services and watched more mobile videos.

Its provision for taxation fell 3% to S$9.8 million after the government earlier this year lowered corporate taxes to 18% from 20%.

Analysts have said M1's lack of value-added services, in comparison with bigger rivals Singapore Telecommunications Ltd. and StarHub Ltd., gives it fewer growth drivers in a mature market.

On Friday, SingTel entered the pay-TV market, allowing it to bundle its TV, phone and broadband services for customers in the same way StarHub has done over the past few years, analysts said.

As of the end of March, SingTel had 1.82 million mobile subscribers in Singapore, while StarHub had 1.59 million.

Montefiore said the company is exploring new growth areas, such as taking part in a bid for Singapore's government-funded national broadband network.

Results of the bid will be out later this year and the islandwide network is scheduled to be ready by 2012.

Montefiore said M1 wants to become a "retail-service provider" once that network is running, adding the company may use the network to offer pay-TV services.

-By Vladimir Guevarra, Dow Jones Newswires; +65 6415 4155; vladimir.guevarra@dowjones.com

-Edited by Matthew Oakley

(END) Dow Jones Newswires"

Posted to the site on 23rd July 2007