[ad_1]
KUALA LUMPUR (Nov 27): Axiata Group Bhd’s net profit nearly doubled, or increased 96.9%, to RM352.99 million or 3.8 sen per share in the third quarter ended September 30, 2020 (3QFY20), from RM179.27 million or two sen per share in the corresponding previous quarter, thanks to higher earnings before interest, taxes, depreciation and amortization (EBITDA) as a result of lower depreciation and amortization, plus a lower exchange loss and taxes.
Quarterly revenue, however, fell about 1.6% to RM6.11 billion from RM6.21 billion in 3TFY19 due to decline in all operating companies (OpCos) except mobile operations in Bangladesh, Sri Lanka and the infrastructure segment, according to a document filed with Bursa Malaysia today.
The telco did not declare dividends for 3QFY20.
On a quarterly basis, the company saw its net profit quadruple (up 341.1%) of RM80.02 million or 0.9 sen per share, while revenue grew 5.5% from RM5.79 billion in 2QFY20.
Axiata attributed the improvement in quarterly earnings to loosening locks and accelerating demand for data as a result of higher revenue growth.
For the nine cumulative months ended September 30, its net profit, however, plummeted 44.8% to RM621.12 million from RM1.12 billion last year, while revenue fell 2.1% to RM17.94 billion from RM18.32 billion.
The company attributed the contraction in earnings for the nine-month period to higher depreciation and amortization, foreign exchange losses, and lower one-time earnings partially offset by lower taxes.
So far this year, Indonesia has recognized a one-time gain on the sale and lease-back of telecommunications towers of RM450.7 million, as opposed to last year’s one-time gain on the disposal of non-strategic investments and the disposal of rights to investment in India totaling RM511.5 million.
On the outlook, its chairman and chief executive officer (CEO) of the group, Tan Sri Jamaludin Ibrahim, said that 4TFY20 has become a challenge again as some countries, including Malaysia, have re-imposed closures.
“This has affected many companies and customers and consequently it has also affected our business. There is also more competition, especially in Indonesia, ”he added.
In fact, the company anticipates a single-digit percentage decline for revenue as it reiterated that the capex guidance for the year will be less than RM6 billion, said the group’s deputy general manager Datuk. Izzaddin Idris, at a virtual press conference today. .
“The telecommunications industry is critical in today’s environment. I keep using this example, ‘the bridge between providers and services and consumers’.
“Telecommunications companies are … I would not like to use the word resilient because we are affected by lower income, lower consumption, lower registration, but we can overcome the storm. We believe that in that telecom spectrum, edotco, for example, is much more resilient compared to MNOs (mobile network operators), ”said Izzaddin.
However, given Axiata’s strong performance, margin expansion and increased free cash flow, Jamaludin said that the group’s balance sheet experienced one of its best moments with a cash balance of RM10.7 billion.
“After reducing some debts in the fourth quarter, we still expect to end the year with a healthy and effective debt profile of around RM6 billion. This gives us a huge cushion to face most economic and pandemic scenarios, ”added Jamaludin.
At noon, Axiata shares rose seven sen or 2.09% to RM3.42, valuing it at RM31.36 billion. 2.67 million shares were traded.
[ad_2]
