Axiata Group’s profit plummeted in Q1 due to forex losses and one-off charges, as the Malaysia-headquartered company posted modest revenue growth and prepared for tough medium-term business conditions.
Net profit attributable to owners dropped 74 per cent year-on-year to MYR188.1 million ($43.2 million) on currency fluctuations and exceptional expenses, particularly an MYR76.9 million employee restructuring programme by Celcom.
Revenue of MYR6.04 billion was up 1.5 per cent, with growth at most of its operating companies.
President and CEO Jamaludin Ibrahim said there was limited immediate impact from Covid-19 (coronavirus), with most markets only facing restrictions in the second half of March.
He said data traffic increased in all markets, from 12 per cent to 40 per cent in March and the trend continues, but the operator failed to capitalise because free data offers related to the pandemic affected “revenue in Malaysia” and some other markets.
Ibrahim said the company is braced for challenges in the short-term due to “choosing to respond responsibly to society’s needs even as it eats into our revenue”.
“We are also aware it will get even tougher in the mid-term when livelihoods are further impacted as some sectors falter and fail, leading to salary cuts and job losses”.
He added it will continue to invest in 4G networks and enterprise services “as economies everywhere attempt herculean efforts to bounce back in the new normal”.
It withdrew full year guidance due to uncertainties around the pandemic, identified additional cost savings above the MRY900 million it already targeted for 2020 and plans to defer about 15 per cent of capex.
Celcom’s mobile service revenue declined 5.1 per cent to MYR1.43 billion as its subscriber base fell 10.8 per cent to 7.98 million and blended ARPU declined 2 per cent to MYR48.00.
Revenue at XL in Indonesia increased 8.8 per cent to IDR6.5 trillion ($441.7 million) on the back of strong data growth. ARPU rose 9.1 per cent to IDR36,000. It added 430,000 subscribers to end March with 55.5 million.
Ibrahim said he was encouraged by XL’s continued growth trajectory in revenue and EBITDA, fuelled by data services.
Sri Lanka unit Dialog’s revenue was flat at LKR29.3 billion ($157.1 million), with blended ARPU dropping 2.8 per cent to SLR380. Subscribers increased 4.7 per cent to 14.95 million.
Robi in Bangladesh recorded 6.5 per cent service revenue growth to BDT19.3 billion ($227.2 million), driven by 28.8 per cent data growth. Blended ARPU of BDT124 was up 0.8 per cent.
Revenue at Ncell in Nepal declined 11 per cent to NPR12.04 billion, ($99.2 million) on slower data adoption due to capacity constraints related to a delay spectrum assignment and intense price competition. Subscriber numbers rose 4.5 per cent to 17.2 million; ARPU decreased 14.2 per cent to NRP233.
Tower unit edotco posted 3.7 per cent revenue growth to MYR455 million, with a 10.3 per cent rise in towers owned to 20,728 and tenancy ratio stable at 1.61 per site.