Early in Q307, DTAC was able to migrate approximately one-third of its prepaid subscriber base, whose promotions expired at the end of Q207, to new packages with increased tariffs. The migration, couple with general tariff increase for new subscribers during the quarter, resulted in lower usage and more outgoing traffic staying within DTAC's network. The higher on-net traffic had positive impact on interconnect (IC) costs.
DTAC recorded a 4.9% YoY and 2.3%QoQ underlying service revenue growth as a result of growth in subscriber base. However,owing to a decline in incoming traffic, service revenues with IC increased by only 0.9% QoQ. The EBITDA margin dropped to 27.7% due to IEC one-time charge of THB 290 million relating to termination of a service provider agreement. Excluding the one-time charge, the EBITDA margin increased by 1.7 pp to 29.4% due to the reduction of net IC costs.
UCOM's delisting was successfully completed with 99.5%of total UCOM paid-up shares tendered for DTAC new shares. UCOM was delisted from the Stock Exchange of Thailand (SET) on September 14, 2007 and, on the same day, DTAC's new shares were listed.
On the regulatory front, the administrative court ruled against TOT's request for an injunction against the ruling of the NTC's Dispute Resolution Committee (DRC), ordering TOT to enter into an IC negotiation with DTAC. Separately, DTAC brought CAT and Hutch to the DRC for refusing to enter into IC negotiation with DTAC.The concession clarification process is still in progress.DTAC is still awaiting prefix for IDD and has not commercially launched the service. In addition, Mobile Number Portability (MNP) is still being studied by operators and the NTC.
DTAC released figures for the third quarter of 2007 showing a customer growth of 0.4 million for the period. DTAC’s total customer base now stands at 14.9 million. Total Revenues in the third quarter increased by 33% year on year to 16.4 billion baht, due to customer growth and the introduction of the interconnect regime in February 2007. Excluding interconnect, revenues grew by 4% YoY. EBITDA grew by 4%, while net profit came in at 1.4 billion baht, up 14% compared with third quarter of 2006. Chief Executive Officer Sigve Brekke said the third quarter had seen the effect of economic slowdown taking its toll on consumer confidence and spending. “We are cautiously optimistic for the rest of the year and maintain our full year guidance that the whole market will grow by around 10 – 12 million new numbers.” “We also look forward to the upcoming election and the formation of the new government early next year, which will bring back investors’ and consumers’ confidence.”
DTAC is the second largest mobile operator in Thailand. DTAC is listed on Singapore Stock Exchange (SGX) and Stock Exchange of Thailand (SET).
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