The Tuas Ltd (ASX: TUA) share price is up more than 10% after the Asian ASX telco share announced strong progress in the FY23 report.
Tuas has operations in Singapore, where it has quickly built a large subscriber base.
Tuas share price
FY23 result
Here are some of the highlights from the 12 months to 31 July 2023:
- Revenue increased 50% to $86.1 million
- EBITDA (EBITDA explained) went up around 100% to $31.1 million
- Net loss improved $11.4 million to a net loss of $15.3 million
- Subscribers increased 40% year on year to 819,000, and went up 18.5% over six months
- Operating cash flow of $40 million
Tuas said that its average revenue per user (ARPU) improved year on year to $9.37 per month, up from $9.19 per month.
Revenue was boosted by higher subscriber numbers as well as operating leverage. Tuas has mobile network costs whether it has 1 subscriber or 800,000 subscribers, so more subscribers means it can split the network costs among more people, which increases profit margins as new subscribers come on board.
Revenue growth and earnings growth can help the Tuas share price.
5G and fibre broadband progress
As with most telcos with mobile networks, the rollout and success of the 5G network is key.
Tuas said that its 5G (NSA) non-standalone (where the 5G network is supported by the existing 4G infrastructure) has been commercially launched. It noted that more than 35% of the user base has 5G devices.
It said that it’s on target to exceed 60% outdoor coverage by the end of 2023 and the eSIM has been enabled.
Tuas said that there is potential flexibility to optimise the spectrum assets.
Turning to the fibre broadband update, it said that it’s targeting early October 2023 to launch into homes in the north east corridor. A full launch is planned by the end of the FY24 first half.
Outlook for the Tuas share price
Tuas revealed that it’s expecting ongoing mobile subscriber growth in FY24.
The FY24 mobile and broadband capital expenditure guidance is for between $45 million to $50 million. It’s focused on completing its broadband rollout.
Tuas also said that it will exceed IMDA 5G coverage milestone and continue to “expand and deepen” the 5G footprint.
I think it’s one of the more promising ASX growth shares, so I’d say it is still a good long term buy, though it’s not as good value as it was yesterday.
