Axiata net profit slips in first half of 2014

27 Aug 2014

Malaysian telecoms group Axiata posted a lower net profit in the first half of 2014, despite recording revenue growth of 1.5%.

In the second quarter of 2014 Axiata generated operating revenues of MYR4.730 billion (USD1.46 billion), up from MYR4.629 billion in the corresponding quarter of 2013, while in the first half of the year turnover was MYR9.245 billion, compared with MYR9.111 billion in H1 2013. Axiata noted, however, that revenues had declined at its domestic unit, Celcom, in the first half of 2014, falling 7.4% year-on-year to MYR1.742 billion, while in Indonesia (XL Axiata) a negative impact related to foreign exchange movements saw turnover dip by 9.1% to MYR1.361 billion. Nonetheless, revenue growth at Robi (Bangladesh), Dialog (Sri Lanka) and Smart (Cambodia) more than offset such declines, with the trio recording turnover of MYR316 million (up 23.3%), MYR241 million (up 3.4%) and MYR54 million (up 105.8%), respectively. Meanwhile, Axiata highlighted the growing importance of data as a growth driver, revealing that such services now account for 20% or more of turnover in both Malaysia and Indonesia.

Group EBITDA for the first half of 2014 stood at MYR3.531 billion, compared to MYR3.644 billion a year earlier, with the decline attributed to the impact of the acquisition of Indonesian mobile network operator Axis Telekom. Profit after taxation and minority interests (PATAMI) meanwhile fell 10.9% year-on-year due to the lower EBITDA and forex, to MYR1.254 billion.

In operational terms, at the end of June 2014 Axiata’s local mobile subsidiary Celcom had a total of 13.441 million subscribers, up from 12.959 million a year earlier, while Sri Lanka’s Dialog saw customer numbers rise from 8.275 million to 9.491 million. Atlhough Robi Axiata also recorded y-o-y customer growth, with accesses rising from 22.897 million at end-June 2013 to 24.0168 million a year later, this was down from a peak of 25.380 million at end-2013, though the decline was attributed to the figures being adjusted as per the local telecoms regulator’s revised ’90-days active’ definition. XL also saw subscriber declines in the first half of 2014, with customer numbers falling from 68,500 at end-March 2014, to 62.868 million just three months later; no reason was given for the drop.

Commenting on the quarterly performance, Axiata chairman Tan Sri Dato’ Azman Hj. Mokhtar said: ‘It was a mixed quarter for the Group. Whilst Celcom, the Axis acquisition and forex translation dragged earnings in the short term, overall good operating performance was seen in all other markets.’

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