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StarHub net profit down 8% in Q1

First quarter earnings of local telecommunications service provider StarHub has fallen by eight per cent year-on-year to S$84 million.

SINGAPORE: Local telecommunications service provider StarHub has posted a drop in first quarter earnings.

Net income came in at S$84 million -- falling by eight per cent from the same period a year ago. StarHub said the drop was due to higher provision for taxes and lower adoption grants recognised.

StarHub saw on-year increases in revenues for its mobile and fixed network services segments.

Mobile revenue grew one per cent to S$306 million, supported by an increase in its post-paid subscriber base.

Fixed network revenue increased two per cent to S$90 million.

However, revenue for its PayTV and Broadband businesses, hurt by keen competition, saw a decline.

Based on the current outlook, the group expects service revenue to grow in the low single-digit range for 2014.

Overall, StarHub is seeing relatively stable average revenue per users (ARPUs), and industry observers say they are positive about growth in the area of new devices.

"I don't think they should be too hung up or worried about ARPUs as the market is saturated right now,” said David Kuo, CEO of The Motley Fool Singapore.

“Anyone who wants a device has already got a device. The secret is new devices coming out. We want more people to connect to the service by using more and more devices. So that is how they're going to be making more revenue."

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