Hong Kong mobile operator SmarTone saw its net profit for the full financial year dive 36% on rising network operating costs and lower handset margins.
Net profit for the fiscal year 2013-2014 ended June 30 fell to HK$537 million ($69.3 million) from HK$843 million a year earlier.
Service revenue slipped to HK$5.4 billion as local mobile service sales and roaming revenue declined and wireless fixed broadband business continued to scale down.
Although mobile subscribers rose 3% to 1.88 million by June, local mobile service revenue dropped 3% and blended APRU fell 11% to HK$234.
The company blamed the declines in service revenue and APRU for the lower-priced 3G speed-capped plan and customer migration to lower priced SIM-only plans from handset-bundled plans.
The poor result is also caused by the slow migration of customers from unlimited 5GB data plans to tiered-pricing. Executive director Patrick Chan said “the migration has been not as good as expected, and quite disappointing.”
“A lot of customers are still holding on their old plans. When their contracts expire, they are not migrating to new plans but keep staying on the same monthly plan,” Chan said. “The number [of unlimited data plan customers] is still higher than we had wished.”