Malaysia-based Axiata Group reported solid financial results for Q3, with double-digit revenue growth driven by a recovery at its Indonesian mobile unit XL Axiata and continuned gains in data, which accounted for nearly half of total service revenue.
The company’s net profit rose 7.9 per cent year-on-year to MYR319 million ($77.4 million), on the back of forex gains during the period, compared with losses from a weak Malaysian ringgit in Q3 2016.
XL Axiata’s strong performance in Q3 2017 helped fuel a 13.6 per cent increase in group revenue to MYR6.2 billion. The company attributed the growth to continued traction in data revenue, which accounted for 46.8 per cent of service revenue compared with 35.5 per cent in Q3 2016.
Jamaludin Ibrahim, president and group CEO of Axiata (pictured), said: “The group achieved a few significant milestones to record strong double-digit growth on all key financial indicators. I am encouraged with the quarter-on-quarter improvements at Celcom, although there is still more work to be done. Likewise, XL has been successfully executing on its transformation strategies and our other mobile operating companies remained on a strong growth course.”
He said a group-wide cost optimisation programme surpassed its full-year goal for 2017 within the first nine months to deliver MYR960 million in cost savings and avoidance, some MYR160 million above target.
The profit increase came despite the share from its associates and joint ventures falling more than 100 per cent to a record loss of MYR142 million in the quarter. The decline was the result of losses at Idea Cellular in India amounting to MYR156 million in the recent quarter compared with a loss of MYR200,000 in Q3 2016, as the Indian mobile market continues to be negatively impacted by Reliance Jio’s aggressive price competition.
Celcom in Malaysia continued it slow recovery, delivering a 1.5 per cent year-on-year increase in revenue to MYR1.67 billion. Data turnover grew 25.4 per cent and accounted for 44 per cent of service revenue, up from 36 per cent a year ago.
While blended ARPU rose 12 per cent to MYR46, its subscriber base dropped by 1.5 milllion from Q3 2016 to 9.67 million at end-September.
XL Axiata’s revenue grew 18.4 per cent to MYR1.9 billion on the back of a solid performance in data revenue, up 71.4 per cent from Q3 2016. Data revenue represented 59 per cent of service turnover in Q3 2017, up from 40 per cent in the 2016 quarter.
It added 7.5 million subs since Q3 2016, taking its total to 52.5 million. Blended ARPU up was 2.9 per cent year-on-year to IDR35,000 ($2.59).
In Bangladesh, Robi-Airtel Q3 revenue increased 28.4 per cent to BDT17.5 billion ($208 million) as it benefitted from a larger subscriber base after a merger with Airtel and a better performance in the data segment, which registered 83.3 per cent growth year-on-year.
Sri Lanka’s Dialog reported an 11 per cent increase in revenue to LKR24.2 billion ($157 million) driven by data revenue growth of 39.2 per cent. Data accounted for 20 per cent of service revenue compared to 14 per cent in Q3 2016.
Ncell in Nepal posted a 1.9 per cent drop in revenue in Q3 to NPR14.6 billion ($141 million), but in Malaysian ringgit terms turnover was up 8.7 per cent. The operator rolled out 4G service in 19 cities.
Looking ahead, Jamaludin said: “We are cautiously optimistic on our fourth quarter performance given the recent surge in competitive activities in Indonesia and Cambodia, and remain very concerned with the Indian market.”