Maxis Bhd posted net profit of RM532 million in the second quarter ended June 30, 2010 and it expects higher revenue growth momentum, underpinned by the encouraging demand for broadband and mobile Internet access.
It said on Monday, Aug 30 while it continued to focus on achieving an efficient cost structure, it was increasing its investments while also incurring subsidies and additional operating expenses to support its broadband and data business which will provide significant additional revenue in the future.
Maxis’ operating profit was RM720 million while earnings per share were 7.10 sen. It declared an interim dividend of 8.0 sen per share.
Revenue recorded a quarter-on-quarter revenue growth of 2% or RM39 million, underpinned by an increase in revenue from advance data services (ADS), wireless broadband and hubbing business.
“ADS revenue has increased by 9% with the continued growth in mobile internet usage aided by the wide usage of smartphones and the additional products and services launched.
“Wireless broadband revenue grew by 32% due to an increase in the number of subscriptions from 313,000 as at March 31, 2010 to 448,000 as at June 30, 2010,” it said.
Maxis said the increase in ADS revenue contributed to the increase in the monthly postpaid average revenue per users (ARPU). However, the monthly prepaid ARPU was impacted by the higher take up of lower priced plans. It said despite competition, the wireless broadband maintained its ARPU at RM69.
The group’s earnings before interest, taxation, depreciation and amortisation (EBITDA) and EBITDA margin were impacted by the cost incurred for the 2010 FIFA World Cup sponsorship and the increased interconnect costs on higher hubbing traffic in the quarter, partly offset by cost savings from cost management initiatives.
As a result of the lower EBITDA and higher finance costs partly offset by lower depreciation charge, pre-tax profit of RM720 million was RM45 million or 6% lower than the preceding quarter. Consequently, profit for the period was lower at RM532 million compared to RM552 million in the preceding quarter.
For the six months ended June 30, 2010, there was a 2% increase or RM99 million over the corresponding period last year due to increased non-voice revenue generated from the mobile services.
It said the growth in non-voice revenue was primarily due to increased usage of mobile internet and wireless broadband services.
“Mobile subscriptions grew 14% with prepaid and wireless broadband growing by 1,312,000 and 277,000 subscriptions respectively,” it said.
However, both the ARPU for prepaid and wireless broadband were impacted by the higher take up of lower priced plans with postpaid maintaining its monthly ARPU at RM103.
The average monthly blended MOU per subscription remained relatively flat at 173 minutes as a result of increase from the prepaid segment that was partially offset by a decline in the postpaid segment.
As a result of the lower EBITDA and higher finance costs partly offset by lower depreciation charge, PBT at RM1.485 billion was RM47 million or 3% lower than the corresponding period last year. Consequently, profit for the period was lower at RM1.084 billion compared to RM1.141 billion in the corresponding period last year.
On the outlook, Maxis said the group expected higher revenue growth momentum with the encouraging demand for broadband and mobile internet access.
“The recent regulatory changes on termination rates are not expected to have a material impact on the Group’s results, based on current forecast of traffic pattern.
“The group will continue to fortify its market leadership by providing more innovative new products and services to satisfy customer needs, investing in the network including increasing the high speed wireless broadband coverage and deploying new capabilities via its information TECHNOLOGY [] transformation,” it said.
Written by Joseph Chin
The Edge Malaysia
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