True profit surges, expands mobile market share

True profit surges, expands mobile market share

Q4 net profit B398m vs B1.88bn a year earlier

A woman speaks on a mobile phone as she stands next to the logo of True Corp in Bangkok on Monday. (Reuters photo)
A woman speaks on a mobile phone as she stands next to the logo of True Corp in Bangkok on Monday. (Reuters photo)

True Corp, Thailand's largest telecoms provider, said on Monday net profit surged nearly two-thirds in 2015, boosted by rising income from its mobile business and a substantial drop in interest expenses.

True, controlled by billionaire Dhanin Chearavanont's Charoen Pokphand Group, also forecast service revenue to rise 13-17% this year, compared to 10.8% growth in consolidated service revenue in 2015.

Its market share of the mobile business rose to 20.8% in the fourth quarter, it added.

True, 18% owned by China Mobile, reported a net profit of 4.4 billion baht in 2015, a 58% increase from a year ago, and its second consecutive profit. Interest expenses fell for the year 41.9% after a large debt repayment.

Revenue from the mobile business jumped 17.3% in 2015, outperforming the industry growth rate of 0.3% and helping the mobile unit to contribute profit of 1.1 billion baht, the company said.

Fourth-quarter net profit, however, dropped 79% to 398 million baht due to an absence of gains from asset sales.

True group, the country's third-largest mobile operator, won a 4G licence for 76.3 billion baht in a December auction, in addition to another licence that it won in a November auction.

The company is due to sign a contract of credit guarantee facilities for the licence with banks on Tuesday, and some analysts expect True to post a net loss this year due to an increase in debt.

Net debt to earnings before interest, tax, depreciation and amortisation (Ebitda) rose to 3.67 times in 2015 from 1.61 times after the company paid the first installment for the 4G licence it won in November.

The company is in the process of raising 60 billion baht from an equity issue, which should help keep its net debt to Ebitda ratio to less than two times, it said.

True shares jumped 2.17% to 7.05 baht in a market down 0.80% on Monday.

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