4 Key Things M1 Ltd Wants Investors To Know About Its Business Plans For 2016

Shares of M1 Ltd (SGX: B2F) have been in a funk lately. Over the past 12 months, the telecommunications company has seen its stock price decline by over 30%.

In a recent briefing for its 2016 first-quarter earnings, M1’s management team shared their business plans for 2016. It contained four key initiatives that M1 will be focusing on. The discussion was centred on the slide below:

2016-04-19 M1 slide
Source: M1’s presentation

As a brief background, M1 has four main business segments: Mobile services; Fixed services; International services; and Handset sales. The first key area is the Mobile services segment. M1’s Chief Commercial Officer Lee Kok Chew said:

“During the quarter, we enhanced product propositions to attract and retain customers. This includes improving our SIM-only plans, upsizing data bundles and increasing coverage of our Data Passport countries. We have continued to launch new and innovative products and services throughout the year to build customer loyalty and attract new customers.”

The actions described by Lee were taken to attract and retain customers. He said that competition is not new to M1 and that the company’s focus is on customer experience and providing a superior network.

The second key area is on M1’s Fixed Services segment. Lee commented:

“In the corporate and government segments, we have expedited investment in our fibre network to establish to commercial buildings and major data centers and also expanded our suite of cloud-based offerings and smart vertical solutions. Together we are positioned as the alternative full-service provider and primary wireless@SG provider, this will further strengthen our capabilities to capture growth opportunities.”

M1 also thinks that the launch of over-the-top (OTT) entertainment content services will be a positive for the company. Lee explained:

“On content we have revised our approach and will no longer provide light content. The launch of Netflix and other OTT services effectively unbundle content from access, and this is positive for M1 fibre. We are focused on enabling access to content and optimize our network for streaming experience.”

The final area may seem a little more esoteric for a traditional telecommunications firm. It involves investments in early-stage companies. Here’s what Lee has to say:

“Looking ahead, we are investing in new technologies that will complement our core business. This may be in early-stage companies for which benefits may only accrue in future years.”

M1 plans to invest up to 2% of its annual revenue on such initiatives. The benefits are not expected to be visible immediately and may take a few years to materialize. And of course, there’s also the possibility of failure when it comes to such investments.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong owns shares in Netflix.