DIGI – lower quarter for 2011
Filed Under (Business News) by Webmaster on 21-07-2011
Tagged Under : DIGI, result
DiGi.Com Bhd’s second-quarter net profit ended June 2011 were 15.12 per cent lower at RM236.3 million from RM278.4 million a year ago, despite higher operating profit.
This is because it had to factor in accelerated depreciation of telecommunication network assets and early-redemption of bank borrowings, DiGi said in its statement to Bursa Malaysia.
The country’s third largest mobile operator said the current quarter earnings before interest, tax, depreciation and amortisation (Ebitda) and its Ebitda margin stood at RM671.9 million and 45.8 per cent respectively.
They were markedly higher than the RM578.4 million gross profit and 43.3 per cent gross margin posted in the same quarter last year.
For the half year, its net profit rose to RM567.71 million from the RM556.66 million net profit recorded a year ago. Group revenue grew to RM2.9 billion from RM2.62 billion previously.
DiGi has maintained its target to achieve high single-digit revenue growth for the full year.
It explained that the RM145.5 million accelerated depreciation of existing telecom network assets was in anticipation of the ongoing network modernisation as well as infrastructure sharing arrangement with Celcom.
Chief executive officer Henrik Clausen reiterated DiGi’s commitment to prioritising network modernisation, network collaboration and cost-focus initiatives as long-term building blocks needed to sustain growth and deliver strongly on its mobile Internet and mobile broadband proposition.
“We are making progress in infrastructure sharing initiative with Celcom and our network modernisation exercise,” he said.
DiGi will soon begin physical network swapping and aims to have an LTE-ready network by end-2012 so that our customers can quickly benefit once the spectrum becomes available.
In the current quarter, there was a decline in DiGi’s average revenue per user to RM50 from RM53 in the previous financial period.
This was brought on by the cumulative effect of newly-acquired subscribers with lower spending, margin pressure from increased competition and lower domestic interconnect revenue resulting from the downward revision in regulated mobile termination rate which took effect from July 2010.
“Our focus on driving the ‘Internet for All’ proposition has helped drive our strong data growth. Today, we have over 5.3 million mobile broadband and mobile Internet customers,” Clausen said.
DiGi also said the effective tax rates for the current quarter and six months ended June 2011 of 27.4 per cent and 26.5 per cent respectively were higher than the statutory tax rate of 25 per cent, due to expenses not deductible for tax.
