TM revises 2018 KPIs, introduces new broadband plans

• Downward revision of KPIs as Unifi, TM1 and TM Global face challenges
• Entry level broadband package 40% cheaper at below RM100

IN LIGHT of the recent commitment by the Malaysian Communications and Multimedia Commission (MCMC) to reduce broadband prices by at least 25%, Telekom Malaysia Bhd (TM) on July 3 announced revised headline key performance indicators (KPI) for financial year 2018.

The acting CEO of TM, Bazlan Osman commented “We are currently facing numerous challenges namely intensifying competition; increasing business and operating costs; cautious enterprise spending as well as increasing regulatory pressures.”

Due to these challenges, TM is revising its expected revenue growth to -1% to flat for year 2018, group operating profit (earnings before interest and tax (EBIT)) at approximately RM1 billion and a customer satisfaction measure of 72.

In TM’s original headline KPI announcement on Bursa Malaysia dated Feb 27, the targets set were revenue growth at 3.5% to 4.0%, customer satisfaction measure at 74 and EBIT growth maintained at 2017 position of around RM1.09 billion.

“This revision is necessary because all three business segments namely unifi, TM1 and TM Global are facing challenges from increased competition, shrinking communication budgets from enterprises and the Mandatory Standard on Access Pricing (MSAP) respectively,” Bazlan said.

Bazlan also said TM is revising its capital expenditure (capex) guidance for 2018 to between 20% and 22% of revenue compared to the initial 25-30% guided earlier this year. “In the interests of our long-term growth, we are keeping a close eye on our operating costs and capex to ensure alignment to expansion goals.”

Chief financial officer of TM, Nor Fadhilah Mohd Ali shared, “At the existing capex level and facilities that we have built, we have sufficient to cater for our operations. However, TM will continue to assess market conditions and tap into opportunities in the debt market.”

“In our ongoing transformation journey and to adapt to the changing landscape, TM has embarked on our 4th wave of Performance Improvement Programme 2018 (PIP 2018) which looks at four main pillars of Revenue Uplift, Sustained Profitability, Improved Cash Flow and Increased Productivity,” Bazlan said.

In efforts to boost its market leader position, TM also announced the introduction of its four new broadband and mobile plans with more than 40% reduction in the price of its entry level package. TM’s executive vice president, Imri Mokhtar said that more details on the packages will be announced on July 12, 2018.

When asked about new broadband plans for businesses, Imri said “Business plans will be announced in due course. Currently, we are sorting out home customers first.”

As of now, the new packages are:

1. An entry level unifi package at 30Mbps for below RM100 for B40 lower income groups open for pre-booking on July 15, 2018.
2. unifi ‘turbo’ plans with more than double the current broadband speed starting Aug 15, 2018.
3. Special upgrade for pre-unifi (formerly Streamyx) customers in unifi areas nationwide.
4. Re-launch of its ‘unlimited’ unifi Mobile postpaid plan from July 15, 2018.

“As part of our commitment to deliver on the government’s broadband aspiration, we will progressively introduce these new broadband and mobile plans,” Bazlan said.

On the launch of the unifi ‘turbo’ plans, Imri said, “The launch of these plans will increase Malaysia’s global competitiveness with the three main measures being price, speed and coverage.” He adds that these plans will catapult Malaysia beyond the majority of its regional peers.

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