StarHub (CC3) H2 2023 earnings summary

Executive summary

• FY2023 total revenue rose 2% to $2,373M; Service Revenue increased 5.5% to $1,992M, exceeding the 3%–5% guidance range.

• FY2023 NPAT was $149.6M, up 140.4% YoY; net profit attributable to shareholders was $165M. Adjusted NPAT was $87.4M, up 76.5%.

• FY2023 met the $150M DARE+ NPAT milestone; FY2024 marks the tail end of the investment phase before a focus on harvesting returns.

Financial highlights

• Service EBITDA rose 13.8% to $431.8M; FY2023 margin was 21.7%, while margin excluding specified non-recurring items was 21.6%.

• Excluding $30.8M of FY2022 DARE+ provisions and a $1.2M FY2023 reversal, Service EBITDA grew 5.0% YoY.

• FY2023 operating cash flow was $358.6M and free cash flow was $185.9M.

Outlook and guidance

• FY2024 Service Revenue guidance is 1%–3% growth, excluding D'Crypt divestment; FY2023 Service Revenue excluding D'Crypt was $1,945.4M.

• FY2024 Service EBITDA margin guidance is approximately 22%, supported by DARE+ benefits and continued cost optimisation.

• FY2024 capex guidance is 4%–6% of total revenue for BAU capex and 11%–13% including investments, excluding spectrum rights.

• FY2024 dividend guidance is at least 6 cents per share or at least 80% of NPAT adjusted for one-off, non-recurring items.