True Corporation Plc. reported positive momentum driven by ongoing growth in service revenue and subscriber acquisition. Integration is progressing on track, with key areas contributing to synergies demonstrating successful integration efforts. Realization of synergies along with structural efficiency initiatives led to the third consecutive quarter of EBTIDA uplift since amalgamation.
Manat Manavutiveth, True Corporation’s Chief Executive Officer, said that True Corporation is happy to report ongoing improvement in financial performance in the third quarter as we cross six months since the completion of the amalgamation. We’ve not only met but exceeded performance targets, showcasing our commitment and capability.
The ongoing return of tourists and migrants continued to positively impact macroeconomic growth while the competition situation in the ICT industry mostly remained stable as the operators remained focused on value creation through additional lifestyle benefits for customers. The company is on track towards planned integration progress and the realization of synergies as we communicated during our Capital Markets Day.
As of Q323, we achieved net synergies of THB 4.4 billion, which benefit CAPEX and EBITDA. The execution of the Single Grid project progressed as planned with the integration process starting in September. Within a short month, over 300 sites were consolidated while an additional 100 sites were decommissioned, each realizing synergies with energy and rental savings. The Single Grid, with an increased number of base stations, reflects our commitment to providing superior service to our growing customer base through optimized signal towers and expanded network coverage.
The execution of Single Grid will pick up full pace in the fourth quarter as we remain on track with our integration plan. We are successfully following the merger plan’s roadmap, ensuring strategic alignment. The Company also achieved revenue synergies with the gradual uptake of Fixed-Mobile Convergence (FMC) offerings, reporting an 8% growth in FMC subscribers since amalgamation, with 10% ARPU uplift during the same period. True Corporation will remain committed to delivering on strategic priorities, utilizing our combined market execution strength, executing on integration plans and achieving synergies to deliver value for our stakeholders.”
Sharad Mehrotra, True Corporation’s Deputy Chief Executive Officer, said, “dtac and True persist to be the leading brand among tourists and migrants, as we continue to use our next generation capabilities in analytics and AI in offering personalized and tailored content to meet evolving customer needs. We witnessed a 3.7% QoQ improvement in daily average tourist revenue and a 20% higher score in customer satisfaction compared to pre-amalgamation. Since amalgamation, combined efforts to provide customers with lifestyle benefits under privilege programs led to approximately 120 million transactions under loyalty programs. At the end of Q323, our digital monthly active users have surged to 15 million, showcasing a robust digital presence.
Commercial Operations area achieved a 56% efficiency in harmonizing “omni-channel” experience against 2023 target, which resulted in a higher number of shops catering to both dtac and True customers for all products and services, enhancing customer experience. The efficiency measures led to enhanced productivity with seamless integration & reduction of operational redundancies. With 90% 5G and 99% 4G population coverage achieved by Q223, True remains the widest 5G network in the country. As of Q323, the largest 5G subscriber base of 9.4 million also makes True’s 5G network the most preferred network in Thailand. Continuous efforts to enhance customer experience has led to QoQ improvement in both 4G and 5G data usage, with consistent uplift in 5G ARPU.”
dtac and True brands continue to remain trusted by customers aided by continuous experience enhancement while catering to evolving customer needs by providing value for money. As a result, in the third quarter, mobile subscribers increased by 254K to 51.4 million, registering a growth of 0.5% from the previous quarter. 5G subscribers reached 9.4 million, increasing by 13% from Q223 with continued QoQ improvement in usage and ARPU uplift of 10-15% mainly driven by device bundling.
Nakul Sehgal, True Corporation’s Co-Chief Financial Officer, said, “True reported improving financial performance for the third quarter of 2023 driven by higher service revenue and ongoing subscriber addition. Normalized EBITDA improved for the third consecutive quarter since the amalgamation, benefitted by the realization of synergies and structural initiatives to achieve efficiencies. This aligns with our plan, reflecting improved financial health.
Consolidated total revenue improved by 2.4% from the previous quarter driven by higher service revenue and product sales. Service revenue increased 1.4% QoQ driven by improvement in mobile and pay tv segments along with ongoing growth in subscribers. Subscriber acquisition remained strong resulting in 51.4 million subscribers at the end of Q323, while mobile service revenue improved by 1.4% QoQ benefitted by higher contribution from tourist and migrant segments along with offer rationalization. PayTV revenue improved by 5.8% QoQ mainly driven by seasonal concerts. Product sales increased by 18.7% QoQ due to the launch of iPhone in Q323.
Total operating expenses excluding depreciation & amortization increased by 7.7% from the previous quarter, driven by increase of 15.1% in cost of sales in tandem with higher product sales and a one-time positive impact in Q223. Other elements of operating expenses remained well controlled due to structural efficiency initiatives while being benefitted by realization of synergies. Normalized for one-time effects, EBITDA improved by 2.0% QoQ, marking the third consecutive quarter of growth since amalgamation. Improvement in EBITDA was driven by topline growth along with synergy realization and efficiency initiatives, with a healthy EBITDA to service revenue margin of 54.1%. Net Loss After Tax was reported at THB 1,598 million, a 31.1% improvement QoQ including the impact of integration costs for the quarter. CAPEX for Q323 amounted to THB 3,481 million, benefited by capex efficiency synergies from the amalgamation.”
In terms of sustainability, True Corporation has been ranked No.1 “Global Sustainability Index DJSI” for 5 consecutive years in the emerging market telecom category. True Corporation’s status as Dow Jones Sustainability’s Indices member has maintained into the 6th consecutive year, solidifying its commitment to corporate responsibility covering all three relevant dimensions of economic, social and environment development.
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