AIS sees lower Q3 earnings on seasonal factors
The Business Times (10 October 2007)
(BANGKOK) Advanced Info Service (AIS), Thailand's top mobile phone operator, said yesterday that it expected lower third-quarter earnings than in the previous two quarters as mobile phone use dropped in the rainy season. Upturn up ahead: AIS expects Q4 performance to improve due to more spending with elections in Dec 'Our third-quarter performance should be the lowest for this year as demand was seasonally low in the rainy season,' company president Wichian Mektrakarn told reporters. But the fourth-quarter performance should improve due to more spending during the election campaign,' he said, referring to a general election scheduled for Dec 23. AIS, one-fifth owned by Singapore Telecommunications Ltd, reported a 3.66 billion baht (S$172.5 million) net profit in the second quarter and a first-half net profit of 7.65 billion baht, down 23 per cent. It is due to announce third-quarter earnings next month, and 20 analysts polled by Reuters Estimates forecast a 2007 net profit of 17.06 billion baht, up 5 per cent from 2006. Full-year operating profits will also drop from last year after the weak first half, which was hit by higher costs and fierce competition, Mr Wichian said. AIS, which has about 50 per cent of the domestic mobile market, has raised tariffs for new customers gradually, signalling the end of an industry price war, analysts said. It has about 23 million subscribers now and aims to keep a 50 per cent share of the Thai mobile phone market, Mr Wichian said. The company, which started up 17 years ago, has said it expects 5 million net new subscribers this year, up from 3.1 million last year. It had 3.2 million net additions in the first half of this year. Thailand has more than 46 million mobile users, or about 70 phones per 100 people, compared with around 80 in Malaysia and more than 100 in Singapore. The Thai penetration rate is expected to reach 80 per cent in the next few years, analysts said. The company will also seek more licences to operate international gateways, fixed-line services and WiMax, a technology which provides long-distance wireless Internet access to home computers and mobile phones, Mr Wichian said. It has said it plans to spend 20 billion baht on expanding its network, excluding 3G, in 2008. It expects to invest an initial US$500-600 million in third-generation (3G) mobile services and to get a 3G licence early next year. AIS is 43 per cent owned by Shin Corp, controlled by Singapore's Temasek Holdings since the family of ousted premier and Shin founder Thaksin Shinawatra sold its controlling stake in the conglomerate in January 2006. After the sale, AIS was hit by a small boycott of Shin goods and services by people angered at the family's tax-free deal and a probe into whether Temasek's US$3.8 billion takeover broke laws limiting foreign ownership of Thai firms. Shares in AIS, valued at around US$8.9 billion, were up 1.05 per cent at 96.50 baht at the midday break, when the overall market was up 0.16 per cent. -- Reuters
The Business Times (10 October 2007)
(BANGKOK) Advanced Info Service (AIS), Thailand's top mobile phone operator, said yesterday that it expected lower third-quarter earnings than in the previous two quarters as mobile phone use dropped in the rainy season. Upturn up ahead: AIS expects Q4 performance to improve due to more spending with elections in Dec 'Our third-quarter performance should be the lowest for this year as demand was seasonally low in the rainy season,' company president Wichian Mektrakarn told reporters. But the fourth-quarter performance should improve due to more spending during the election campaign,' he said, referring to a general election scheduled for Dec 23. AIS, one-fifth owned by Singapore Telecommunications Ltd, reported a 3.66 billion baht (S$172.5 million) net profit in the second quarter and a first-half net profit of 7.65 billion baht, down 23 per cent. It is due to announce third-quarter earnings next month, and 20 analysts polled by Reuters Estimates forecast a 2007 net profit of 17.06 billion baht, up 5 per cent from 2006. Full-year operating profits will also drop from last year after the weak first half, which was hit by higher costs and fierce competition, Mr Wichian said. AIS, which has about 50 per cent of the domestic mobile market, has raised tariffs for new customers gradually, signalling the end of an industry price war, analysts said. It has about 23 million subscribers now and aims to keep a 50 per cent share of the Thai mobile phone market, Mr Wichian said. The company, which started up 17 years ago, has said it expects 5 million net new subscribers this year, up from 3.1 million last year. It had 3.2 million net additions in the first half of this year. Thailand has more than 46 million mobile users, or about 70 phones per 100 people, compared with around 80 in Malaysia and more than 100 in Singapore. The Thai penetration rate is expected to reach 80 per cent in the next few years, analysts said. The company will also seek more licences to operate international gateways, fixed-line services and WiMax, a technology which provides long-distance wireless Internet access to home computers and mobile phones, Mr Wichian said. It has said it plans to spend 20 billion baht on expanding its network, excluding 3G, in 2008. It expects to invest an initial US$500-600 million in third-generation (3G) mobile services and to get a 3G licence early next year. AIS is 43 per cent owned by Shin Corp, controlled by Singapore's Temasek Holdings since the family of ousted premier and Shin founder Thaksin Shinawatra sold its controlling stake in the conglomerate in January 2006. After the sale, AIS was hit by a small boycott of Shin goods and services by people angered at the family's tax-free deal and a probe into whether Temasek's US$3.8 billion takeover broke laws limiting foreign ownership of Thai firms. Shares in AIS, valued at around US$8.9 billion, were up 1.05 per cent at 96.50 baht at the midday break, when the overall market was up 0.16 per cent. -- Reuters
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