TRUE GROUP REPORTS STRONG QUARTERLY EBITDA IMPROVEMENT ON SOLID GROWTH AT TRUEMOVE H AND NET PROFIT IN 1Q14 DRIVEN BY ITS INVESTMENT IN TRUEIF
BANGKOK, May 22, 2014 – True Corporation PLC (SET: TRUE) posted outstanding results for the first quarter of 2014. EBITDA surged QoQ on TrueMove H’s robust performance while True Group reported a net profit, resulting from its investment in TRUEIF.
True Group reported consolidated service revenue of Baht 16.5 billion in 1Q14. EBITDA picked up strongly at 41.9% QoQ to Baht 4.7 billion due to the success of cost control implementation, mainly related to significant reduction in selling and marketing expenses during the quarter, as well as accelerated performance of TrueMove H’s 3G business.
Net income from ongoing operations, excluding deferred income tax, improved significantly to Baht 4.3 billion in 1Q14 due to growing EBITDA, lower interest burden given positive impact from the debt prepayment in late last year, and a recognition of the investment in the TRUE Telecommunications Growth Infrastructure Fund (“TRUEIF”). According to the accounting standard, the investment entities are required to measure investment at fair value. The investment in TRUEIF, periodically conducted valuation by independent financial advisor commissioned by SCBAM, significantly increased in 1Q14. Thus, True Group recognized this incremental value as well as performance of the fund, in proportion of its over 33% investment in TRUEIF, totaling Baht 5 billion, and reported a net profit of Baht 3.8 billion in 1Q14.
True President and CEO Suphachai Chearavanont said, “We are delighted to see a strong performance improvement with a net profit in 1Q14. True Group’s continued efforts to build on its strong convergence platform, adjusting marketing strategy to better reach target segments, and implementing strict cost control have progressed very well since the beginning of the year. Given our continued focus on costs, we are confident to achieve our EBITDA target while NIOGO, excluding 2G depreciation expenses which will be fully depreciated by September, will be positive this year.
Healthy growth of the 3G business, which already reached its breakeven point in 1Q14, drove a strong recovery in True Mobile Group’s financial performance. This was driven by ongoing success in attracting high-value customers as well as fast migration of 2G customers. True Mobile Group ended the first quarter with 23.1 subscribers. In 2Q14, the business is ready to amplify this success with an introduction of the “Change… 4G Advance Forward by TrueMove H" campaign and the low-cost 3G devices such as True Super I and True Super Ultra I, enhancing customers’ mobile experiences while expanding TrueMove H’s subscriber base on its best 4G and 3G networks. Even at this early state, these campaigns have received positive response from the market.
Ongoing success of True Group’s convergence packages, combining TrueOnline’s ULTRA hi-speed Internet with other products and services within the Group, its localized marketing activities together with broadband Internet expansion, which reached 4.4 million homepassess in 66 provinces, drove TrueOnline’s broadband subscriber base up to 1.9 million at the end of 1Q14.
Meanwhile, TrueVisions remained committed to enhancing its customers’ viewing experience through more selections of top international and local content. TrueVisions is well placed to broaden its business following the acquisition of the digital terrestrial TV licenses in April. This will not only facilitate strong growth in advertising revenues, but it will also upsurge TrueVisions’ marketing opportunity to broadcast its content to a wider audience base.”
True Group CFO Noppadol Dej-Udom said, “We are pleased with True Group’s improved financial performance during 1Q14, a result of great efforts from all employees of True firming up financial discipline in their day-to-day duty. True Group will continue to closely monitor costs and reduce interest burden to further strengthen our financial position. Meanwhile, True Group’s investment in TRUEIF should be one of the key contributing factors for the Group’s sustainable growth.”