• 4Q20 revenue and EBITDA were within expectations, at 101%/99% of our FY20 forecasts.
• 4Q20 cable subscribers contracted 7,000 QoQ to 716,000. But ARPU was stable at NT$482.
• FY20 capex was down 29% to S$51mn, bumping up adjusted FCF by S$21mn to a record S$67mn.
• FCF of S$67mn to support DPU of 1 cent for 9.3% prospective yields. 5G data backhaul still seen as a multi-year revenue opportunity. DPU of 0.25 cent/quarter will be maintained in FY21. Our forecasts are largely unchanged. Maintain BUY and target price of S$0.15. Set at 9x EV/EBITDA, a 20% discount to Taiwanese peers given the smaller scale, higher leverage and softer growth profile.

The Positive

+ Adjusted FCF surged. FY20 adjusted FCF rose S$29mn to S$67mn. EBITDA inched up to S$180mn but the largest improvement was a 29% or S$21m drop in capex. This is expected to provide ample cover for S$18mn of annual dividend payouts and to pare down debt.

 The Negative

– Core cable TV still shrinking. Cable TV is its largest division, at 64% of revenue. Cable TV revenue expanded modestly by 2% YoY to S$195mn, aided by a 6.1% appreciation of the Taiwan dollar in FY20. 4Q20 subscriber churns were the largest in eight quarters. We think affordable cable prices of  NT$482 or S$23 for 100 channels should still provide some downside support.

Outlook

Stable operating cash flows are expected to sustain quarterly dividends. Growth is anticipated from 5G data backhaul to mobile operators in Taiwan. No guidance has been provided but we expect a 14,000 fall in cable-TV subscribers in FY21e to be offset by a 15,000 increase in broadband subscribers.

Maintain BUY and TP of S$0.15

Yields of 9.3% are attractive, paid quarterly and well supported by FCF