Management Discussion and Analysis



TRUE REPORTS STABLE SERVICE REVENUE FOR 2010; BROADBAND AND NON-VOICE DELIVER 

STRONG PERFORMANCE



BANGKOK, February 25, 2010 - True Corporation PLC (SET: TRUE) reported stable 

service revenue for the full-year 2010, supported by strong Q4 results.

Broadband and non-voice delivered strong growth, advertising revenue drove

growth at TrueVisions, and iPhone 4 sales and the Q4 prepaid recovery stabilized

 performance at TrueMove.



In 2010, consolidated service revenue excluding interconnection charges (IC) was

stable, rising 0.1% to Baht 52.6 billion. Overall performance improved in Q4,

especially with the prepaid recovery and strong iPhone 4 sales at TrueMove. FY10

EBITDA, however, declined 6.1% to Baht 18.4 billion mainly on higher network

costs which were partially offset by a net IC gain and contributions from

product sales.



FY10 net income from ongoing operations (NIOGO), excluding deferred tax, 

decreased to Baht 257 million. However, bottom-line profit rose to Baht 2.0

billion from a loss of Baht 1.2 billion in 2009 mainly on a one-time gain

relating to the TrueVisions refinancing.



True President and CEO Suphachai Chearavanont said, "True achieved stable 

full-year revenue despite the tough challenges from competition and the impact

of political unrest earlier in the year.



"However, the situation improved in Q4 when TrueMove prepaid revenue recovered 

from the impact of competition in the first nine months. Strong Broadband

performance and the contribution of higher advertising revenue at TrueVisions,

and market-leading iPhone 4 sales are also worth special mention. These positive

 trends are expected to continue.



"Our convergence strategy continued to flourish in 2010 with the number of 

households using multiple True services rising 5.6% to 2.5 million," said Mr

Suphachai.



TrueOnline 2010 service revenue increased 3.6% to Baht 27.3 billion driven by 

strong growth in Broadband, business data and convergence. Broadband revenue

rose 9.7% to Baht 6.5 billion, on network upgrades and the launch of 6Mbps

service. Broadband net adds more than doubled from 2009 to 122,000, increasing

the subscriber base by 17.7% to 814,000. The rate of decline in fixed-line

revenue slowed in 2010, while contributions from new businesses, such as

international direct dialing (IDD), continued to rise.



True Move service revenue (excluding IC) was stable, up 0.2% at Baht 23.6 

billion supported by growth in postpaid (9%) and non-voice (12.8%) revenue.

Rising mobile Internet and smartphone usage drove the strong growth in non-voice

revenue. Throughout the year True built on its position as the leading premium

smartphone operator which saw mobile Internet revenue almost double. However,

prepaid revenue declined 6.6% on intense competition in on-net promotions. This

recovered in Q4 on the launch of promotions targeting new customer segments.

TrueMove ended the year with 17.1 million subscribers, up 1.3 million from 2009,

with a stable subscriber market share of 24.5%. In 2010, net IC balance

improved to a gain of Baht 181 million.



TrueVisions service revenue increased 0.5% to Baht 9.6 billion. Advertising 

revenue from the first full year of operations was Baht 482 million. This fully

offset declines in subscription revenue from the tourism and hospitality

industries caused by political unrest in the year's first half. Mass market

growth saw subscribers rise 2.5% to 1.7 million. The upselling rate increased to

 38.5%.



TrueVisions completed its Baht 12 billion refinancing in June which lowered the 

cost of borrowing, eliminated forex exposure and increased operational

flexibility which will facilitate future growth.



True Group repaid Baht 5.7 billion of debt in 2010 and long-term debt fell 

slightly to Baht 67 billion. However, Group net debt-to-EBITDA ratio rose

slightly to 3.3 times from 3.1 times in 2009.



True Group CFO Noppadol Dej-Udom said, "Our debt continued to decline during the

year and deleveraging remains a key long-term priority for the group. Cost

controls implemented in 2010 will be continued throughout 2011 to improve

profitability."



Looking forward to 2011, Mr Suphachai said, "On a Group level, we will roll out 

new technologies to expand our convergence strategy and strengthen our position

as Thailand's only quadruple play operator. True will grow revenue by increasing

network coverage and capacity and improving customer service across all

businesses.



"We will leverage the acquisition of a local mobile network from Hutchison Group

to lead commercial 3G services in Thailand. TrueOnline will pioneer the

transition to next generation Broadband with DOCSIS 3.0 technology. TrueVisions

will further penetrate the mass market to increase advertising revenue, while

technological innovation will differentiate it in the premium market."

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