Axiata’s profit falls sharply as Celcom, XL again disappoint - Mobile World Live

Axiata’s profit falls sharply as Celcom, XL again disappoint

25 AUG 2016

Asian regional operator Axiata again reported a sharp fall in its net profit, as its two largest regional units – Celcom and XL – continued to lose subscribers and see declines in revenue.

Axiata chairman Azman Mokhtar said: “In spite of a challenging industry environment in several core markets, Axiata’s good spread of assets contributed significantly to the group’s solid performance.”

“This is evident with over 67 per cent of Axiata’s revenue being generated outside of Malaysia today, making the portfolio both more resilient and positioned for growth in selected markets,” he continued.

Jamaludin Ibrahim, Axiata’s president and CEO, said the second quarter delivered mixed results. “On one hand, the completion and consolidation of Ncell ahead of our midyear schedule provided the group with immediate financial accretion. Also, XL’s balance sheet post completion of its rights issue and tower sale is at a healthy level. We recognise Celcom’s results came in below our expectations, impacting our results at mid-year.”

The group’s net profit for the quarter dropped 63 per cent to MYR232 million ($57.8 million), which it attributed to the weak performance of many of its operating companies, incremental depreciation and amortisation, higher net finance costs and forex losses.

EBITDA was up 20.4 per cent to MYR2.1 billion.

Group revenue increased 12.8 per cent year-on-year to MYR5.3 billion.

Mixed regional results
Celcom’s revenue again declined, falling 6.6 per cent to MYR1.68 billion. Blended ARPU was down 9.3 per cent to MYR39 ($9.72).

Its prepaid subscriber base dropped 9.7 per cent quarter-on-quarter due to continued competition and a delay in the launch of new products. But it again posted positive postpaid traction after launching new data-led plans in February, adding 57,000 such subscribers in 2Q.

Data as a percentage of total revenue grew to 32 per cent from 27 per cent last year, while smartphone penetration jumped 11 points to 66 per cent from a year ago.

XL saw a 6.7 per cent drop in revenue to IDR5.25 trillion ($401 million). It continued to shed prepaid customers, losing two million over the past year to end the quarter with 44 million. It added 62,000 contract subscribers.

Blended ARPU rose 9 per cent to IDR35,000 ($2.67). Data accounted for 34 per cent of revenue, up from 26 per cent in Q2 2015, and smartphone pentration rose from 36 per cent to 53 per cent.

Sri Lankan market leader Dialog saw revenue increase nearly 19 per cent to SLR21.1 billion ($142 million), with its subs base growing 9 per cent to 11.1 million and blended ARPU rising 16 per cent to SLR390 ($2.63).

Smartphone penetration hit 39 per cent after rising 13 points year-on-year.

Robi, the third largest operator in Bangladesh, posted a 4 per fall in revenue to BDT12.4 billion ($155 million). Its customer base rose 2.7 per cent year-on-year to 27.4 million, but blended ARPU dropped 6 per cent to BDT135 ($1.69).

Axiata completed the acquisition of Ncell in Nepal on 11 April, so had consolidated 2.5 months of Ncell’s results. Its year-to-date revenue, EBITDA and profit after tax growth were 1.4 per cent, 6.8 per cent and 44.5 per cent, respectively.


Joseph Waring

Joseph Waring joins Mobile World Live as the Asia editor for its new Asia channel. Before joining the GSMA, Joseph was group editor for Telecom Asia for more than ten years. In addition to writing features, news and blogs, he...

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