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StarHub
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vivacious
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24-Nov-2021 09:39
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looking good
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chart_expert123
Master |
24-Nov-2021 09:23
Yells: "Only buy stock with revenue or net cash flow growth!!!!" |
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1.35-1.36, +3%. DBS TP 1.6. by 2022. |
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vivacious
Supreme |
23-Nov-2021 10:40
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131 not bad | ||||
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Joelton
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23-Nov-2021 09:29
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Investors, grab your popcorn: StarHub, Singtel are trying to boost their entertainment value
SINGAPORE telcos, once known for their embrace of " quad-play" product bundling, have been revamping their entertainment strategy with fresh attention paid to digital content.
Rather than offering over-the-top (OTT) subscriptions as add-ons to mobile, broadband or pay-television bundles, recent moves show that telcos are now approaching OTT services as a product in their own right - a promising rethink in a challenging environment for revenues.
Next, they must have the resolve and purpose to execute a full-fledged strategy for such content, especially as the pivot to OTT services and the demise of pay-TV seem inevitable.
Telcos may have dragged their feet on embracing OTT until push came to shove - especially since pay-TV has a bigger sticker price and is more profitable. Consulting firm Kearney has asked " whether the inclusion of these OTT products will yield synergies beyond the dollar value of the OTT product or will consumers treat it as a form of a ' digital gift card' " .
As such, the move to count OTT users in the subscriber base is a shift away from an old mindset where pay-TV subscribers are the core pool and OTT media is thrown in on top.
In the second quarter of this year, StarHub began reporting revenue for a new consumer business unit dubbed " entertainment" , which includes not just pay-TV customers, but also mobile and broadband customers who have OTT subscriptions.
By counting OTT subscribers, StarHub took headline entertainment subscriptions to 408,000 for the quarter, up from 338,000 the year before.
That' s as the number of StarHub pay-TV connections actually dropped to 287,000, from 321,000 previously.
Similarly, Singtel has reported a downtrend in residential pay-TV customers, with the number of subscriptions falling to 368,000 as at Sep 30, from 377,000 the year prior.
Even though the Singapore telcos have managed to pare the business costs of pay-TV by negotiating with content providers for variable instead of fixed-cost pricing, it' s not yet clear how greater prominence of OTT content will affect margins and revenue.
DBS analyst Sachin Mittal remarked that, while StarHub' s experience shows that a decrease in pay-TV subscriptions can be offset by OTT, ultimately " it' s a question of revenue" .
That' s as the contest between OTT media and pay-TV may be a zero-sum game. Market research firm GlobalData has projected that adoption of OTT video services will reduce Singapore pay-TV revenues by 1.5 per cent annually from 2020 to 2025, as IPTV subscriptions could decline by 2 per cent a year to just 630,000 in 2025.
But the decline of pay-TV is the inevitable result of a structural change in viewership habits. It' s thus imperative for telcos to have a strategy to adapt to the new consumption model, and better late than never.
StarHub CEO Nikhil Eapen told the media at a briefing on Monday (Nov 22) that " high-growth businesses run at lower margins than lower-growth businesses in general, but we' re focused not on blended budgets, but on Ebitda contributions" , especially as the group' s businesses gain scale.
He pointed to hopes of " increasing consumption" , as well as " discrete revenue streams adding to the pot" .
StarHub has already indicated that it plans to position itself as a one-stop shop for content. Similarly, Singtel subsidiary Optus launched OTT aggregator " SubHub" in Australia in August, consolidating subscriptions for services such as Amazon Prime, Netflix, Paramount+ and iQiyi.
With StarHub' s launch of an entertainment category and Optus' s launch of SubHub, telcos show that they have realised OTT is critical as pay-TV is on its way out of the door.
Content aggregation
And content aggregation - rather than direct content production - is what Singapore telcos should aim for, especially since they do not have the scale for large media investments.
This May, the United States' AT& T announced a merger of its WarnerMedia unit with Discovery - just three years after it finished a multi-billion-dollar acquisition of Time Warner. If even global behemoths struggle to gel content production with telecom operations, that' s a warning sign.
Aggregating third-party services may have become more attractive as the liquidation of Singtel' s Hooq in March 2020 showed the risks of offering in-house products. In the wake of the winding-up of video-streaming service Hooq - a partnership with Sony Pictures Television and Warner Bros Entertainment - SubHub indicates a new direction for OTT strategy.
Mittal told The Business Times that " Optus is trying an approach where they can become a one-player centre" and added: " We were always worried about the OTT business in the past - but not now, because what these guys have done is, they have dropped the unprofitable areas."
Ideally, this approach to digital content will give telcos confidence to re-evaluate the strategy for the rest of their digital portfolios too, rather than doubling down on sunk costs.
For example, Citi estimated at the start of the year that Singtel could improve on previous years' operating profits by up to 13 per cent if it wound down its digital life assets and international operations such as mobile payments and e-sports.
Indeed, Singtel has been grappling with the future of its digital investments. Hooq and marketing business Amobee were both part of the group digital life division, which was set up in 2012 but folded this year into a new " strategic portfolio unit" .
With Hooq out of the way, Singtel this year turned to a strategic review of Amobee and cybersecurity unit Trustwave after multi-million-dollar impairment charges on the two units.
Lately, Singtel seems to have gone back to the drawing board on another digital product - mobile payments. When Singtel launched its " Via" regional payments alliance in 2018, the expansion of its Dash e-wallet to Thai-land was presented as a boon for cross-border tourists and shoppers.
But Singtel management confirmed on the telco' s last earnings call that the group is now focusing on remittances for its regional e-wallet product, in contrast with a payments focus in the Singapore market.
Some might say that the review of Singtel' s digital investments is overdue, as they were made during the tenure of former chief executive Chua Sock Koong, who retired on Jan 1.
Paul Chew, head of research at Phillip Securities, told BT that Singtel' s latest results " only validate the need to roll back the earlier digital life strategy by disposing (of) Amobee which is still suffering losses after more than nine years" .
Willingness to retool the digital strategy, in a fast-moving digital environment, is thus both welcome and - given the chronic underperformance of businesses such as Singtel' s digital life segment and both Singtel and StarHub' s pay-TV units - urgent.
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chart_expert123
Master |
23-Nov-2021 09:10
Yells: "Only buy stock with revenue or net cash flow growth!!!!" |
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Temasek subsidiary, ST telemedia who own starhub and controlling vast business in region, finally make use starhub as a shell to expand their investment. Starhub is not just a telecoms company, it transform to provide integration service provider. Furthermore, starhub with 1.7bil share and market cap of 2.1bil become an easy growths company as compared to singtel 16bil shares and market 41bil market cap. Slight achievements in starhub can move the share price.
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chart_expert123
Master |
23-Nov-2021 09:04
Yells: "Only buy stock with revenue or net cash flow growth!!!!" |
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https://www.channelasia.tech/article/693288/starhub-steps-into-its-next-phase-transformation/ | ||||
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arkan1111
Veteran |
12-Nov-2021 11:20
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Unless the shortists get stroke then soon... otherwise they are very strong not easy to fight
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john_ric
Supreme |
12-Nov-2021 11:15
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Step by step inching up. | ||||
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chart_expert123
Master |
12-Nov-2021 10:10
Yells: "Only buy stock with revenue or net cash flow growth!!!!" |
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1.6 till 2022. has to be patient. shall watch up free cash flow 160mio, 120% increase is one time or quarterly.
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vivacious
Supreme |
12-Nov-2021 09:17
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1.60 TP
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chart_expert123
Master |
12-Nov-2021 09:06
Yells: "Only buy stock with revenue or net cash flow growth!!!!" |
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StarHub Ltd: 9M21 earnings 5% above our expectations on margin beatDBS Group Research11 Nov 2021
9M21 earnings exceed our expectations on service EBITDA margin surprise. StarHub (STH) reported 9M21 net profit of S$107.4m (+6.0% y-o-y) excluding job support scheme (JSS) payouts, which was 5% above our 9M21F estimate of S$102m. A better-than-expected service EBITDA margin of 29.8% in 9M21 (30.1% in 3Q21) compared to our FY21F estimate of 27.8%, resulted in the earnings surprise. Operating expenses increased by only 2.3% y-o-y to S$1,331.6m compared to a 2.9% y-o-y increase in total revenue to S$1,491m resulting in a service EBITDA excluding JSS payout of S$356.3m (+1.1% y-o-y) in 9M21. STH&rsquo s disciplined approach to opex and numerous cost improvement initiatives have supported the efficiency during 9M21. 9M21 service revenue was inline, supported by growth in broadband and enterprise and sequential recovery in mobile segment. STH recorded service revenue of S$1,197.6m (+2.4% y-o-y) in 9M21, representing 74% of our FY21F estimate of S$1,622.3m. While 9M21 mobile service revenue declined by 11% y-o-y to S$393.1m, 3Q21 mobile service revenue recovered 2.4% q-o-q driven by rising postpaid ARPU and subscriber base. In 3Q21, postpaid subscriber base stood at 1.5m (+1.0% q-o-q) and postpaid ARPU improved to S$29 (S$28 in 2Q21) due to increasing take-up of higher margin SIM only plans, higher roaming, and higher 5G enterprise initiatives. Broadband revenue increased by 11.4% y-o-y to S$145.4m, led by higher ARPU of S$34 in 3Q21 (S$32 in 2Q21), from rising take up of 2 Gbps plans and faster WiFi routers. STH&rsquo s entertainment revenue for 9M21 stood at S$135.5m (-3.8% y-o-y) along the expected lines due to lower Pay TV subscriber base (decrease of ~9,000 subscribers to ~287,000 in 3Q21). However, the entertainment segment is witnessing a rise in OTT (over-the-top) subscribers where the total OTT subscriber count for 9M21 stood at ~121,000 (q-o-q net add of ~29,000). STH&rsquo s enterprise segment reported 9M21 revenue of S$523.5m (+14.4% y-o-y) supported by resilient growth in cybersecurity and regional ICT services. Cybersecurity and regional ICT services reported operating profit of S$6.8m and S$0.8m in 9M21. As of 9M21, cybersecurity services and regional ICT services represented 48.2% of enterprise revenue. STH acquires 60% of HKBN JOS Holding, a financially accretive acquisition. To expand the regional ICT services and thereby expanding its enterprise business, STH acquired a majority stake (60%) in HKBN JOS (both the Singaporean and the Malaysian units), at an estimated total consideration of S$15m, fully financed by cash. JOS is a leading system integrator and ICT solutions provider, which matches the profile of STH&rsquo s regional ICT and enterprise segment offerings. JOS has a customer base of over 1,500 and employs over 400 talents in its four offices in Singapore, Kuala Lumpur, Johor Bahru, and Penang. The acquisition of JOS is also expected to reap cost synergies in fixed operating costs and improved supply chain. Between StarHub and JOS in Singapore as well as between Strateq and JOS in Malaysia, the companies can cross sell their Ensign and D&rsquo Crypt offerings and expand their customer channels in Singapore, Hong Kong, and Malaysia. Capex guidance lowered for FY21F. Earlier capex guidance (excluding 5G capex and spectrum rights) was supposed to be 9-11% of the total revenue. However, owing to the ongoing transition of IT related capex to cloud-based opex model paired with other capex delays, the capex guidance for FY21F has been lowered to 7-9% of total revenue. No change in our FY21F estimates. STH&rsquo s service EBITDA margin (ex. JSS payout) for 9M21 at 29.8% was higher than our FY21F forecast of 27.8%, prompting us to revisit our outlook. However, the management expects more advertising, promotions, IT repairs and maintenance costs to be incurred in 4Q21F. Hence, we are not raising our FY21F earnings of S$133m yet. Maintain BUY with a TP of S$1.60 for ~26% upside potential and a dividend yield of 5.4% (based on FY22F DPS). |
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Joelton
Supreme |
11-Nov-2021 10:00
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StarHub revenue grows on cybersecurity services gains, improved broadband ARPU
MAINBOARD-LISTED telco StarHub StarHub: CC3 -0.79% got a topline boost from growth in its fast-expanding enterprise business, even as the company unveiled the acquisition of more regional information and communications technology (ICT) players on Wednesday (Nov 10).
StarHub saw third-quarter revenue rise by 5.6 per cent year-on-year to S$517.2 million for the 3 months ended Sep 30, 2021, up from S$489.7 million, with service revenue up by 7.6 per cent to S$418.1 million.
That is even as earnings declined on the back of tapering Jobs Support Scheme (JSS) wage subsidies. Net profits fell by 9.5 per cent to S$40.2 million, from S$44.5 million a year ago. Excluding the JSS, net profits rose in tandem with revenue by 5.1 per cent to S$40 million, up from S$38.1 million posted last year.
The recent gains in headline turnover were fuelled by a 17.3 per cent rise in revenue contributions from the enterprise business segment. In particular, cybersecurity services revenue &ndash the largest slice of the enterprise pie &ndash grew by 73.1 per cent year-on-year to S$79.3 million.
Citing higher contributions from the cybersecurity services segment, as well as the deferral of some planned IT transformation operating expenditure into 2022, StarHub raised its full-year guidance for service earnings before interest, taxes, depreciation and amortisation (Ebitda) to &ldquo at least 26 per cent&rdquo &ndash from 24 per cent to 26 per cent before &ndash although StarHub chief financial officer Dennis Chia added on a call that &ldquo we are expecting to exceed&rdquo the forecast.
On the consumer front, broadband revenue saw 9.5 per cent growth from higher average revenue per user (ARPU) to S$49.8 million, with a lift from increased take-up of higher-tier plans and faster routers.
Granted, broadband subscribers as at Sep 30 continued to decline, falling to 485,000 from 500,000 a year ago. But StarHub consumer business chief Johan Buse dubbed the drop a &ldquo temporary effect&rdquo from unbundling legacy products and services, which he expects will stabilise this quarter.
The picture was grimmer in the rest of the consumer segment, with mobile revenue falling by 0.6 per cent to S$133.3 million, on lower prepaid revenues amid Covid-19 travel restrictions, and migration towards SIM-only plans. Prepaid ARPU fell to S$10, from S$12 in the year-ago period.
However, post-paid ARPU held steady year on year, at S$29. Post-paid subscriptions stayed mostly flat year on year, at 1.5 million lines.
Disclosing that StarHub has &ldquo well north of 250,000&rdquo mobile customers now on 5G, Buse said: &ldquo We do see appetite for customers taking up 5G on the back of (5G-ready) devices but increasingly also on 5G SIM-only, and that... has led to the ARPU increase, so that&rsquo s a very promising trajectory.&rdquo
StarHub&rsquo s new entertainment segment &ndash which includes all residential pay-television (pay-TV) subscribers, as well as mobile and broadband subscribers with over-the-top (OTT) services subscriptions &ndash saw revenue down by 4.6 per cent to S$45 million.
This was attributed to a lower pay-TV subscriber base, and lower commercial TV revenue and advertising spend by. Pay-TV subscriptions declined by 10.6 per cent to 287,000, even as total entertainment subscriptions rose 20.9 per cent to 408,000. Still, segment ARPU improved to $43, from $40 before, due to increased price for HomeHub bundled plans.
Buse called the uptrend in ARPU and total customers &ldquo the good news&rdquo , adding: &ldquo Let&rsquo s see in the next few quarters how that&rsquo s going to pan out.&rdquo
For the 9 months ended Sep 30, 2021, net profit fell 11.2 per cent to S$108.2 million year-on-year, but rose 6 per cent to S$107.4 million with the JSS effect excluded. Revenue rose 2.9 per cent to S$1.5 billion, with service revenue up 2.4 per cent to S$1.2 billion in the same period.
StarHub chief executive Nikhil Eapen noted in a statement that the conclusion of the 3-year &ldquo Dare&rdquo transformation programme helped the company to exceed its initial cost savings target and upgrade the service Ebitda margin guidance.
StarHub plans to launch the successor &ldquo Dare+&rdquo initiative, which will last for 5 years, on Nov 22. The scheme &ndash meant to optimise operations and costs &ndash will be boosted by &ldquo financially and strategically accretive acquisitions that also augment our market position&rdquo , Eapen added.
In line with the acquisitions appetite, StarHub separately announced plans to take a 60 per cent stake in Hong Kong-listed broadband and telecom group HKBN&rsquo s HKBN JOS (Singapore) and HKBN JOS (Malaysia) for S$14.9 million in all, to be funded by internal resources. The deal is expected to be done by end-2021.
HKBN JOS (Singapore) and HKBN JOS (Malaysia) offer enterprise ICT services such as infrastructure support and digital and cloud technologies solutions. Pro forma for the 9 months to Sep 30, the acquisition would have contributed S$86 million to StarHub&rsquo s regional ICT services revenue and accounted for 14 per cent of the overall enterprise segment, StarHub said.
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chart_expert123
Master |
11-Nov-2021 06:44
Yells: "Only buy stock with revenue or net cash flow growth!!!!" |
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Furthermore, we will see more improvement on mobile slowly when starhub, singtel and M1 differentiate themselves with 5G standalone net work with TPG and other 10 MVNOs which market segmentation will be getting obvious and with better aaru rare for mobile. I am quite happy to see positive cash flow of 160 over mmio which is good for starhub expansion plan without asking money through issue new shares. Starhub is just 2.1bil shares as compared to singtel 16bil. If temasek think to expand their control of regional digital market, the company to implement it will be starhub which is under telemedia.
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chart_expert123
Master |
11-Nov-2021 06:32
Yells: "Only buy stock with revenue or net cash flow growth!!!!" |
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As compared to other temasek babies, this result is considered good. Pay TV is sunsets while the broadband and mobile speed rates are increasing. My mother 70plus years old already moved to mewatch and smart TV to watch her TV programme anytime.
AARU of broadband increasing is mainly due to enterprise and slowly decoupling with pay TV, like previous all bundled with pay TV with 60-70 dollars subscription fee. After decoupling, starhub may lower down the package and achieve same AARU as republic broadband which is about 40 dollars.
So long as revenue and profit keep growing, it stop starhub 4-5 years downtrend from 4.5 to 1.10 (lowest) and move to an uptrend so long as the enterprise, and broadband, and 5G and its related product package such as cloud base gaming, mobile TV partnership with Netflix and Disney, and future remote and auto pilot services which can be developed.
So long as it can portraits a potential of growth and expansion, starhub price will move up. In fact, as per chart it turn to an uptrend now. What else we are looking for? We are talking a 1.26 starhub instead of a 4.5 starhub. Price is undervalued. DBS given 1.6 in 2 years mean till 2023. But I believe 2023, it shall be above 2 dollars
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Speediman
Veteran |
11-Nov-2021 00:40
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Cashflow is good and they have the money to invest. This is a good sign. Given the covid situation where there is almost no roaming revenue for the 1st 9mths 2021 vs 3mths of roaming revenue in 2020, the 6% increase in profit is credible. Starhub has turned the corner already. Cheap 4G plans maybe coming to an end. TPG may even bow out of Singapore.
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noslen
Veteran |
10-Nov-2021 23:39
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Exactly! Current growth and gain in enterprise IT services is only to cover the declining pay TV revenue and it will continue declining. So in the short term, I don't see share price will go up much unless there's huge interest in Starhub.. so most likely modest gain and not the 1.60 or 1.40 type.
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Speediman
Veteran |
10-Nov-2021 23:09
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Starhub have stopped the profit rot and infact started to rise with business transformation. Cashflow is good and recent investment to grow enterprise segment make sense. Profit margin have been affirmed by management to be higher than forecast. Overall a good set of results. $1.30 - $1.40 should not be a problem |
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chart_expert123
Master |
10-Nov-2021 21:48
Yells: "Only buy stock with revenue or net cash flow growth!!!!" |
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But it is enough to support current price and future prospect gain after covid 19 era in next year.
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chart_expert123
Master |
10-Nov-2021 21:46
Yells: "Only buy stock with revenue or net cash flow growth!!!!" |
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Exclude Job support scheme, net profit 9M 2020 vs 9M 2021, net profit is 6% gain. Revenue is 2% gain.
AARU of mobile is unchanged. Seem like the gain mostly from enterprise. Still long way to go.
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vivacious
Supreme |
10-Nov-2021 21:20
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https://www.businesstimes.com.sg/companies-markets/starhub-revenue-grows-on-cybersecurity-services-gains-improved-broadband-arpu
StarHub revenue grows on cybersecurity services gains, improved broadband ARPU |
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