Maxis Q1 2016 profits marginally up, thanks to postpaid

• Prepaid revenue declines 3.5% in Q1, postpaid up 2.3%
• EBITDA jumps 6.7%, EBITDA margin expands to 54.4%

 
MAXIS Bhd, Malaysia’s largest mobile operator, registered a marginal increase in first quarter (Q1) 2016 net profit to RM484 million, versus RM482 million in the same period a year ago, helped mainly by its postpaid business.
 
[RM1 = US$0.26 at current rates]
 
During the quarter, the company registered RM2.13 billion in service revenue, unchanged from the first quarter of last year. However, earnings before interests, taxes, depreciation and amortisation (EBITDA) went up 6.7% to RM1.16 billion.
 
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The quarter also saw Maxis’ prepaid revenue decline 3.5% to RM1.02 billion, while postpaid revenue rose 2.3% to RM994 million.
 
“This quarter, we recorded similar revenue and profit levels compared with last year in a turbulent market context with a lot of promotional activities,” chief executive officer Morten Lundal (pic above) said in an official statement.
 
“One of the drivers for our postpaid growth was our MaxisOne plan, for which we now have more than one million customers,” he added.
 
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As at March 31, 2016, the company had over 962,000 MaxisOne subscribers, with an average revenue per user (ARPU) of RM150 a month.
 
A deeper look
 
During the first quarter, total postpaid subscribers declined marginally to 3.03 million. It was Maxis’ eighth consecutive quarterly decline in terms of postpaid subscribers.
 
The number of wireless broadband users is also on a declining trend, down to 302,000 versus 412,000 a year ago.
 
Meanwhile, its prepaid subscriber base had its ups and downs. Over the past eight quarters, its prepaid subscriber base hit a low of 9.04 million in Q2 2014, but enjoyed a high of 10.05 million in Q2 2015).
 
It ended Q1 2016 with 9.28 million prepaid subscribers.
 
The company, which spent RM1.4 billion on capital expenditure (capex) in 2015, spent RM159 million on capex in Q1 2016, or RM24 million more than what it spent in the same quarter a year ago.
 
The bulk of the capex it spent was on network modernisation as well as expanding its 3G and 4G LTE (Fourth Generation/ Long-Term Evolution) coverage.
 
As at the end of March 2016, the company’s 3G network covered 92% of the population versus 82% population coverage a year ago, while its 4G network recorded 74% population coverage versus 39% a year ago.
 
About 91% of its networks are now modernised, versus 78% a year ago.
 
Maxis also said that 4G LTE is now available in 36 key towns and cities in East Malaysia, with 90% or higher population coverage in Miri and Kuching.
 
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