SmarTone’s Macau operations back in the black

Hong Kong-listed mobile network operator SmarTone Telecommunications Holdings Ltd. said its operations in Macau have reported an operating profit of HK$1 million (US$129,003) for the year ended June, a turnaround from the loss of HK$17 million registered in the previous financial year.
SmarTone’s results in Macau return to the black amid higher handset profits, the company told the Hong Kong Stock Exchange in its annual results filed on Tuesday.
The mobile network operator’s revenue generated here has gone up by nearly 14 per cent to HK$858.15 million for the year ended June, according to the filing.
SmarTone, a subsidiary of Hong Kong-listed conglomerate Sun Hung Kai Properties, does not operate a fixed-line network business in Hong Kong or Macau. In late June, SmarTone was approved by the Macau telecommunications regulator to provide 4G services to the city under a licence valid for eight years.
Group-wide, the company’s net profit surged 74.2 per cent to HK$935 million for the full year on the back of strong growth in sales and profit of handsets.
Earnings before interest, taxes, depreciation and amortisation (EBITDA) of SmarTone rose by 14 per cent to HK$2.9 billion.
SmarTone’s handset and accessory sales surged 67 per cent year-on-year to HK$13 billion with both sales volume and average unit selling price increasing in the period.
The mobile network operator’s service revenue, on the other hand, rose by a much more modest 3 per cent to HK$5.56 billion. Despite the higher local mobile service revenue achieved, part of it has been offset by lower roaming service revenue.
Total subscriber numbers grew to 1.96 million in the period, while the postpaid monthly average revenue stood at HK$294.
SmarTone’s group-wide revenue rose 41 per cent year-on-year to HK$18.66 billion for the whole year.
The company raised the dividend payout ratio to 75 per cent of net profit, an increase from 60 per cent from a year earlier. The rise was backed by a healthy balance sheet, strong operating cash flow and the conclusion of Hong Kong’s 3G spectrum renewal auction in December.