Thank you for standing by, and welcome to the Tuas Limited Full Year Financial Year 2024 results call. All participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I would now like to hand the conference over to Mr. Richard Tan, CEO. Please go ahead.
Good morning, all. I'm Richard Tan, CEO of Simba Telecom, the main operating vehicle of the Tuas Group. Also joining me on the call are Tuas Executive Chairman, David Teo, and Simba Telecom's CFO, Harry Wong. It is my pleasure today to share with you the FY 24 results of Tuas Limited, covering the period 1st August 2023 to thirty-first July 2024 . Slide two lays out the agenda of this presentation, starting with Harry running through the financials. I will then cover the business updates and outlook. Finally, we'll reserve time for some Q&A. Do again note that the numbers reported are all in Singapore dollars. I will now hand you over to Harry.
Good morning, everyone. My name is Harry Wong, CFO of Simba Telecom. I'll be presenting the financials of the Tuas Group. On slide three, you'll see that we achieved a notable improvement in the financial results during FY 2024 when compared to that of FY 2023. Revenue for this year is SGD 117.1 million, up from SGD 86.1 million last year. EBITDA increased 60%, up from SGD 31.1 million in the prior year to SGD 49.7 million. Net profit after tax of -SGD 4.4 million was a significant improvement on the prior year's loss of SGD 15.3 million. Next, we look at the key financial metrics on slide four. Revenue for the year ending July 31, 2024 increased 36% compared to FY 2023. Mobile ARPU over the last 12 months averaged at SGD 9.68 per month.
This compares to 9.37 for FY 2023. With increasing scale of the business, EBITDA margin has improved to 42% of revenue. The key drivers of this EBITDA uplift are an increased subscriber base and an expanded plan mix, catering to different customers' needs. Slide five shows our sustained subscriber growth since FY 2022. We have crossed the significant milestone of more than 1 million active subscribers during the financial year. The active mobile services as of 31st July 2024 was about 1.053 million, representing a 29% increase over the past one year. We proceed to the cash flow on slide six. This is the first financial year in which we show positive cash flow. This is obviously a big milestone for the company. Opening cash and term deposit balance was SGD 44 million.
Net cash generated from operating activities was 60 million. The main cash outflow comes from acquisition of plant and equipment and intangible assets of 48 million, largely mobile network and some fixed broadband infrastructure. This brings the end cash and term deposits to 35.3 million as of 31 July 2024. With this, I will let Richard proceed with the business update.
Thank you, Harry. Our mobile business growth has been supported by several plans at key price points, and this includes the SGD 12 plan, which is very popular. We will continue to refine our plans in response to market changes to bring more value to all customers. Given our ever-expanding subscriber base, we will continue to invest in our mobile network to grow network capacity, broaden 5G coverage, and improve overall user experience. We are heartened by IMDA's recent decision to allow us to deploy 5G on our 900 megahertz band, which is currently used for 4G. This provides Simba Telecom with the additional flexibility to optimize its network. Moving on to slide eight. We are pleased to announce the completion of our 10 Gb ps island-wide rollout to all residential homes in Singapore.
At SGD 29.99, inclusive of GST per 30 days, and with no service activation fees and free ONT modem, it is the most competitive plan in the market, and we are confident of growing our fiber broadband business. At the end of FY 2024, we have more than 4,000 fiber broadband customers and are putting in every effort to accelerate our growth in this space. Finally, slide nine, which covers the outlook for the business. We had a good start to the 2025 financial year, and we'll continue to push for more broad-based mobile subscriber growth for the rest of the year. Our CapEx for FY 2025, which primarily is allocated to 5G expansion, 4G capacity upgrade, and fiber broadband rollout, will be in the range of SGD 45-55 million, which represents CapEx spending largely similar to prior years.
The group has demonstrated its ability to sensibly manage its cash, to improve on its cash flow, and achieve a full year net profit after tax. Finally, we intend to accelerate our fiber broadband business and help consumers realize the true benefits of 10 Gb ps connectivity. That ends my short presentation, and I will now hand it back to the moderator for the Q&A session.
Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you're on a speakerphone, please pick up the handset to ask your question. Your first question comes from William Park, from Citibank. Please go ahead.
Hi. Thanks for taking my question, Richard, David, and Harry. Just in terms of your mobile subscriber growth there, can we get some color around sort of a mix between prepaid and postpaid growth? And whether if you are seeing increasing momentum in postpaid. Yeah, just wanted to delve into that a bit more, if possible. Thank you.
Thank you for the question. We, as you know, we don't provide breakdown for our subscriber base, but I would say obviously the majority is postpaid. The growth has been very broad-based, so we're very pleased about it. So I think that pretty much positions us for future growth in the mobile business.
Thank you. Previously you highlighted that you've been making good progress around upgrading customers to higher priced plans. Just wondering what the momentum has been like over the last six months or so, whether if it's accelerated, and if so, what are some of the key drivers that have prompted that?
I think you would have heard from me that our SGD 12.00 price plan is very popular, and I also indicated that now growth is more broad-based, so I think that has translated to the improvement of ARPU as well. In general, you would see that people are starting to realize the value that we are bringing for each of the different price plans, and you know, they will subscribe to these price plans accordingly.
Thank you. And then just moving on to broadband. I know it's still early days, given that, you know, you're focused very much on the ramp-up over there, but just in terms of the margin profile there, like, could you provide some color around how we should be sort of thinking about margin as you ramp things up in the FY 25 and beyond, please? Thank you.
So I think while we're not giving any guidance on the margin, it should be quite clear in terms of what the cost of providing the NLT circuit is, versus what we are charging for the service. And then in the context of the IMDA funding that is provided to help accelerate the transition from two point five to 10, I think it's all I would say is that it's still early days because we have just completed the transition. It's early days, so I think we will leave it to the analysts to work out the numbers, and we hope to provide further clarity in the subsequent briefings.
Thank you. And just one last one for me, still on broadband. On the entry into the enterprise market, could you share, like, how you're thinking about the timing around the launch there? How should we be sort of thinking about that and some of the key milestones that we should be watching out for?
So, as you know, Simba is a company that focuses on what I call flawless execution. And then we look at the market opportunity. I think that there's no surprise that the consumer market, it is much bigger than the enterprise market, and in fact, it is more than 10 times bigger than the enterprise market. Our focus is now 100% on the consumer market right now, because that's where, you know, the opportunities lie for Simba Telecom.
Thanks very much.
Thank you. Your next question comes from Joseph Michael, from Morgan Stanley. Please go ahead.
Thank you. Good morning, David, Richard, Harry. Thanks for taking my questions. First one I had was just on mobile. So in the outlook commentary, you said you're pushing for more broad-based mobile subscriber growth. So my question is: What customer segments are you expanding into, and what gives you the confidence to do this now?
So we have obviously quite an interesting journey since we launched our services. Initially, there was a focus on the foreign migrant workers, but since then, we have achieved very good growth across all segments, different age groups, you know, across, as I've said, over various segments. I would say that there is no one particular segment that stands out today. It is, as I would say, broad, broad-based growth. If you look at where traffic is being generated across our network, it is all over Singapore. I wouldn't zoom in on any particular target as of now, and I would say that what we are focusing on is delivering the value for every price point.
Okay, got it. Next question I have is just on broadband. So yeah, it's early days, 4,000 subscribers at the end of FY 2024. Just wondering how you're sort of feeling about the first six months or so in market and what you've achieved to date. Are you sort of happy with the progress you've made? And then, as a follow-up, can you also remind us when you launched the 10 Gb service in market?
Okay, so as you know, we initially launched at 2.5. Then, you know, we obviously had the opportunity to transition to 10, which is very exciting for us because, you know, it puts us in a position where we can offer the highest speed broadband at the most competitive price. And we made it absolutely, frictionless in terms of pricing for people to get on board. At SGD 29.99, no service activation fee, free ONT. We should see, you know, the ability for us to bring on board a good number of customers moving forward. The last six months has been, you know, the work has been focused on upgrading the network because there are two parts of it. We had already rolled out to four central offices, then we decided to make the transition.
What we did was that we installed a new platform for the remaining COs, and we went back to the four to upgrade the COs. A lot of work had been done by the team over the past six months. I'm pleased to say that we are now in a position to focus 100% on selling.
Okay, great. Next question I had was just around reinvestment. So I was just having a look at the numbers. In FY 2024, you added SGD 31 million of incremental revenue, but you only added SGD 6 million in incremental operating costs. So my question is: Are you comfortable with the cost base, or at some point, do you need to put more investment into things like marketing, customer service, et cetera?
Again, Simba Telecom has demonstrated its ability to not only manage its cash, but also, you know, keep its costs at a very, you know, comfortable level. We are very confident in terms of our future moving forward.
Okay, great. And then just last question I had was just around the working capital and cash flow conversion. So 117%, based on my numbers, operating cash flow conversion, a really strong result. And I'm assuming it's what's driving that, it's customers prepaying their mobile plans. So my question is: What percentage of customers on mobile are paying upfront, monthly, quarterly, yearly? Any color there would be helpful.
For mobile customers, everything is on what I call a 30-day cycle. The fact that they are prepaying means that they are happy to stay with us. So it is a vote of confidence on the part of the customer. We're very pleased about that. So all I would say is that, there's no particular, you know, pattern that, you know, for me to outline here, but I would say that, the cash conversion has been good, and we intend to continue that trend.
Okay, great. That's all I had. Thanks for your time.
Yeah.
Thank you. Once again, if you wish to ask a question, please press star one on your telephone. Your next question comes from Darren Odell from Peloton Capital. Please go ahead.
Hi, congratulations on a great result. Just two questions from me. I was just wondering, with the optimization of the, mobile network, if you're able to give any color on further cost savings that may come through in relation to that or how that can work. And also just sort of looking at the enterprise and government markets in the future that you'll sort of target, as you're already doing the small, medium business for the lower end. Does that make sense to think of more of an acquisition strategy for that part of the market, or would you prefer to do it organically?
Let me handle your first question first, with regards to mobile network optimization. I would say that we have a very strong internal engineering capability. Network performance is something that we literally review daily, and we look at how our traffic is distributed across our network as well as our various frequency bands. I talked about nine hundred being able to run 5G on it, and we look forward to the regulator making it technology neutral for all bands. That gives us additional tools to optimize the network further. So I think as far as optimizing the network in particular, absolutely something that, you know, we do daily, and it's something that the team does exceptionally well. Enterprise market, government markets, those continue to be very interesting to us.
It's something that we will go into when we are ready. I can't comment anything beyond that, but obviously the opportunity is there, and it's something that we want to go into. Thank you.
Thank you. Your next question comes from Nick Harris from Morgans. Please go ahead.
Thank you, and good morning, Dave, Richard, and Harry. Just a question, and I appreciate you commented, Richard, you didn't want to talk too much about the, regulatory, sorry, the government grant side of things. But just so I can understand this, your whole sort of core network is now built for the super fast core band side of things, and I think government grants sort of started to be made available from earlier this calendar year. But looking in your accounts, it doesn't look to me like you've booked any. So just curious, you know, are you able to make any comments on that, or do we have you basically applied for the things you can apply for, and we just wait for government feedback on whether you get it or not?
Or am I looking at it the wrong way? Thank you.
So let me put it this way: We have applied, and we have qualified for the funding, and everything else in terms of receiving the funding will be based on the schedule that will be outlined by the regulator. So all of that is in progress, and that's primarily the update I have for now.
Thank you. And just a second one from me was just to circle back to your comments about being able to use the 900 MHz band for 5G. I just wanted to understand... and also your comment just about sort of network neutrality in 5G. So are you kind of suggesting the perfect outcome would be the regulator will let you use whatever network you've got to deliver 5G, and it's up to Simba to decide what the most efficient way to do it is? And point being, therefore, you may not need to buy sort of high, mid, and low band 5G spectrum, but be able to reuse that 900 for 4G if you want to do that. I'm just trying to understand the capital efficiency and just the logic of it. Thank you.
Okay. So, the network that we have built is obviously very flexible. We can run both 4G and 5G on it, depending on, you know, what the regulator has put in place in terms of what you can do for each particular band. So when we received the decision from the regulator that we're able to do it on nine hundred, I think it's an extremely good outcome because nine hundred, as we know, is what we call the coverage band. It provides you with the coverage that the higher frequencies are not able to do so. Now, the engagement with the regulator is always on what I call an ongoing basis.
We will always, you know, push for a position that is, you know, in the best interest of our shareholders as well as our investors, and that is to make all frequency technology neutral. We can't say anything more than that, right now. I think it is responsibility for an operator such as Simba Telecom to always continue with its engagement with regulators to achieve the best outcome for the company.
Thank you. That's my questions done.
Thank you.
Thank you. There are no further questions at this time. I'll now hand back to Mr. Tan for closing remarks.
I would like to thank you all on this call for your time and making the effort to understand our business better, along with our achievements. It's been an exciting journey, and many opportunities lie ahead. The board and management of Tuas Limited appreciates your support, and I wish you a great day ahead. Thank you.
Thank you. That does conclude our conference for today. Thank you for participating. You may now disconnect.