In Touch profit tumbles

InTouch Holdings, the country’s biggest telecommunications conglomerate, saw a sharp decline of 21% in net operating profit last year on falling revenue from satellite and mobile services.

InTouch reported a net profit of 12.7 billion baht in 2016, down from 16 billion in 2015.

Tomyantee Kongpoolsilpa, vicepresident for group investor relations at InTouch, blamed higher marketing costs, including handset subsidy campaigns, huge mobile network investment costs for AIS and a drop in service revenue from Thaicom’s satellite business.

She said expanding mobile network capacity along with acquiring new mobile spectrum ranges are areas InTouch is focusing on to sustain the group’s revenue growth and accommodate skyrocketing demand for mobile data usage.

On average, Thais used 2.6 gigabytes per month last year, expected to increase to 3.6GB in 2017 thanks to the continued popularity of video consumption.

Ms Tomyantee said InTouch, through its venture capital arm InVent, will also continue investing in new startup companies in telecom, media and technology, with a planned investment budget of 200 million baht this year.

InVent has already invested in 10 startups, with a combined investment of 290 million baht over the past few years.

Ms Tomyantee said while AIS’s new dividend payment policy — paying out a minimum of 70% of net profit instead of 100% as before — would inevitably effect InTouch’s consolidated revenue, the group supports the new dividend policy.

InTouch owns a 40.45% stake in AIS. “The reduction is needed in order to maintain our long-term business growth as mobile businesses require heavy investment in network expansion in terms of both capacity and coverage,” she said.