The company posted a net loss of RM367 million for the fourth quarter ended December 2010, compared to RM558 million net profit in the same period a year ago. It took a RM1.08 billion charge for its stake in Idea Cellular Ltd.
"This is a good time to clean up our balance sheet to reflect the conservative nature of our accounting principle.
"Nevertheless, we have a very good year, without this (impairment), we'll be reaching like RM2.7 billion-RM2.8 billion net profit," said president and group chief exe-cutive officer Datuk Seri Jamaludin Ibrahim during a media briefing in Kuala Lumpur yesterday.
Axiata bought Idea at 100 rupees (RM6.95) per share in 2008. Today, it is trading around the 67 rupees (RM4.65) mark.
The group proposed to return RM844 million to shareholders, or 47.6 per cent of its net profit, as dividend.
The group, which also announced its headline key performance indicators (KPIs) yesterday, expects to grow its revenue and earnings before interest, tax, depreciation and amortisation (Ebitda) by at least 10 per cent this year.
It also guided a group capital expenditure (capex) of RM3.3 billion this year, of which, RM1 billion and RM1.7 billion are allocated for Celcom and XL, its Indonesian unit. These capex will be mainly be spent on third generation network and transmission.
"Our KPI is not a forecast per say, it is a principle-based KPI. It means that before we come up with the number, we want to make sure that every operational costs we have grown faster than the industry," Jamaludin said.
It also hopes to maintain its Ebitda (earnings before interest, tax, depreciation and amortisation) margin of 46 per cent this year, despite increasing competition.
"We have to work very hard (to maintain the margin). On one hand, we are under pressure because of competition, and we are also under pressure to reinvest because of the increasing trend of smart phone. That's the not-so-good news. The good news is that there's still room to improve our cost structure," said Jamaludin.
For the fourth quarter, the group's revenue have grown by 7 per cent to RM4.02 billion.
For the full-year period, its revenue rose 17.3 per cent to RM15.6 billion, while net profit rose 7 per cent to RM1.77 billion.
During the year, Axiata managed to achieve all its three headline KPIs. Its full-year capex of RM2.8 billion was also lower than what it originally guided (RM3.6 billion).
"The lower capex were mainly achieved due to improved cost structure," Jamaludin said.
Although the group's cash position is three times higher than what it was a year ago, he said that it has no plans for acquisition over the short to medium term.
"There's no imminent plan (for acquisition) for now. We are not blocking out any opportunities, but we are limiting ourselves on Asean and South Asia. So, the odds (of us acquiring a stake in companies in the region) is quite low. There're not too many (opportunities) available," he said.
He added that the company is expected to announce the candidate for its currently vacant chief financial officer position "very soon". - By Goh Thean Eu of Business Times
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