Digi records healthy growth in 2014, fuelled by solid momentum on data

• Higher service revenue from increased smartphone and Internet adoption
• Aspires to be leading mobile Internet provider for mass market

SOLID data growth fuelled Digi.Com Berhad (Digi) to a strong finish in 2014, with data revenues accounting for 40% of the Group’s overall service revenues in the fourth quarter of 2014.
 
Data revenue grew 17.4% from a year ago primarily driven by strong demand for Internet services, a proliferation of a wider range of smartphones, and the continuous expansion of coverage to more areas around Malaysia, Digi said in a statement.
 
Internet subscribers grew 31% year-on-year to 6.4 million (2013: 4.9 million) from a stronger customer base of 11.4 million. The additional 1.5 million active Internet subscribers accumulated during the year positively contributed to the increase in Internet revenue, which rose 39.6% for the year, and paves the way for future service revenue.
 
Smartphone penetration on Digi’s network also steadily increased to 49.3% from 38.1% a year ago.
 
Digi chief executive officer Lars-Ake Norling (pic) attributed the company’s solid growth across revenue streams, particularly in Internet revenue, to its focus on quality of service and customer excellence.

“The significant improvement in our network performance and coverage, our wide range of affordable smartphones bundles which included prominent smartphone launches, and our widest network of service touchpoints, has positioned us well in accelerating access of quality Internet services to more Malaysians nationwide.

“We have also made a stronger push in the market with extensive ground activities to drive higher acquisition and usage.
 
“Our focused effort in making the Internet easily available and relevant to every customer has resulted in a healthy increase in Internet adoption and significantly higher data traffic on our network, which grew 86% year-on-year,” he added.
 
Digi maintained resilient growth across revenue, earnings before interest, tax, depreciation and amortisation (EBITDA), and profit after tax (PAT), for the full year under review.
 
Revenue grew by 4.2% to RM7 billion in 2014 (2013: RM6.7 billion), while EBITDA and EBITDA margins held steady at RM3.2 billion and 45% respectively (2013: RM3 billion and 45%). PAT climbed to RM2 billion, 19.1% higher than a year ago (2013: RM1.7 billion).
 
[RM1 = US$0.28]
 
Moving forward, Norling said that Digi plans to maintain its 2014 capital expenditure (capex) level in 2015 to continue driving Internet growth.
 
In 2014, it invested RM904 million in capex to strengthen its infrastructure capabilities which included the delivery of a new convergent billing system, expansion of 3G (Third Generation) population coverage to 86%, growth of LTE (Long-Term Evolution) sites to nine market centres and increase in fibre network to more than 4,700km.

In 2014, it invested RM904 million in capex to strengthen its infrastructure capabilities which included the delivery of a new convergent billing system, expansion of 3G (Third Generation) population coverage to 86%, growth of LTE (Long-Term Evolution) sites to nine market centres and increase in fibre network to more than 4,700km.
 
“In the coming months, we plan to grow our postpaid business across consumer and business segments, while maintaining our leadership in prepaid, building on Digi’s distinctive brand promise introduced in conjunction with our refreshed brand launch recently," Norling said.
 
“We believe that the solid foundation we have built for a data business positions us strongly to deliver on our promise to customers and drive data growth,” he added.
 
The company announced that it will pay a fourth interim tax exempt dividend of 7.2 sen per ordinary share equivalent to RM560 million or 100% payout ratio to shareholders on March 13, 2015. Total dividend payout for the year increased by 22.1% (4.7 sen) to 26 sen.
 
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