TM’s Q1 revenues up 1.7%; Net and data now contribute 51% to total

• Group revenues in Q1 up to RM2.42 billion from RM2.38 billion; PATAMI down 14.9%
• Internet services revenue grow 14.4% to RM644 million, driven by UniFi and HyppTV

TELEKOM Malaysia Berhad (TM) reported that group revenues in the first quarter edged up 1.7% to RM2.42 billion from RM2.38 billion in the corresponding period last year, mainly driven by Internet and data services, particularly its UniFi high-speed broadband (HSBB) service.
 
Earnings Before Interest and Tax (EBIT) grew by 9.6% year-on-year (YoY) from RM272 million in Q1 2012 to RM298 million in Q1 2013, which it attributed to higher revenue.
 
Normalised EBIT increased by 9.5% YoY to RM300.1 million, the company said in a statement.
 
Group Profit After Tax And Minority Interest (PATAMI) went down 14.9% to RM213.2 million in Q1, primarily due to unrealised forex (foreign exchange) loss on borrowings of RM18.6 million; compared with a gain of RM67.9 million in the corresponding quarter last year.
 
Normalised PATAMI, excluding mainly unrealised forex loss on USD borrowings, grew by 27.6% YoY to RM234 million.
 
[RM1 = US$0.34]
 
“Overall, we continue to show good progress on our business transformation efforts, amidst a heightened competitive environment,” said TM group chief executive officer Zamzamzairani Mohd Isa (pic).
 
“We are pleased to report a steady performance for the first quarter of the year with a 1.7% growth in operating revenue, and 9.6% growth in EBIT YoY.
 
“We recorded healthy growth particularly in Internet and data services, with UniFi being the key driver, growing 68.4% to more than 532,000 customers in Q1 2013 from a year ago,” he added.
 
Zamzamzairani said that to date, TM has activated over 560,000 UniFi customers on the back of more than 1.4 million premises passed over 104 exchange areas.
 
“This translates to an almost 40% take-up rate,” he said. “In the first quarter, our Internet services turned in a revenue of RM644 million, a growth of 14.4% YoY from RM563 million recorded in 2012, on the back of a 6.8% growth in broadband customer base.”
 
Data revenue increased by 13.8% YoY to RM585 million in the current quarter from RM514 million in Q1 2012, driven by new circuits installations and upgrades to higher bandwidths.
 
“With this, Internet and data revenue now contribute 51% of the group’s total revenue, as compared with 45% a year ago,” said Zamzamzairani. “Collectively, our broadband customer base grew to 2.11 million in Q1 2013 from 1.97 million in the same period last year, a growth of 6.8%.”
 
TM said it also recorded continued improvement in its capex (capital expenditure) efficiency, with total capex spend/ revenue ratio improving from 12% for Q1 2012 to 9.7% this quarter as a result of higher revenue and lower capex incurred.
 
Total capex spent for Q1 2013 was RM236 million, lower against the corresponding quarter last year, which stood at RM287 million.
 
“Traditionally, our first quarter performance is reflective of the seasonal nature of the business,” said Zamzamzairani.
 
“Nevertheless, we believe we have secured a footing for better earnings by focusing on enhancing competitiveness, customer experience and cost efficiencies. We hope to keep up the momentum towards the later part of the year with continued growth in our core areas.
 
“Our Performance Improvement Programme (PIP) 3.0 will be our priority for 2013 where we will focus on the key initiatives for the longer term growth for the company,” he added.
 
In January, TM expanded the coverage of its HSBB access to non-HSBB (UniFi) areas by improving the quality of its copper infrastructure, and introduced new 8Mbps bandwidth for Streamyx and Business Broadband packages.
 
The new bandwidth offering complements TM’s existing broadband packages of 1Mbps, 2Mbps and 4Mbps, the company said.
 
“To remain competitive in the prevailing environment, we have introduced several exciting ‘value for money’ package offerings from as low as RM30 a month for our HyppTV service in our effort to provide customers with more value and enhanced TV viewing experience for their whole family,” said Zamzamzairani.
 
“The newly launched packages are testament to our continuous effort in satisfying customers’ viewing needs and preferences, be it entertainment, edutainment or sports content,” he added.
 
TM said it was also strengthening its regional business, including ICT/ Business Process Outsourcing (BPO) and Global businesses.
 
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