Prepaid disappointment, postpaid boost for Digi in Q2 2016
By Digital News Asia July 12, 2016
- Prepaid service revenue dips 2.8% QoQ and 6.7% YoY
- Action is in postpaid, where revenue registered record growth
MOBILE operator Digi.Com Bhd had a mixed second quarter ended June 30 2016, reporting lower pretax profit but higher profit after tax; lower prepaid revenue but higher earnings from postpaid.
Its postpaid service revenue registered a record growth of 9.8% year-on-year (YoY) and 6.1% quarter-on-quarter, while its postpaid subscriber base increased strengthened 10.3% YoY to almost two million subscribers, the company said in a statement.
Postpaid Internet subscribers increased to 1.6 million, representing 81.7% of the company’s postpaid subscriber base and contributing to the higher postpaid Internet revenue of RM239 million (Q1 2016: RM207 million). [RM1 = US$0.24]
It also recorded a lower pre-tax profit of RM575.64 million in Q2 2016 versus RM626.35 million a year ago, while prepaid service revenue dipped 2.8% quarter-on-quarter and 6.7% YoY.
Service revenue dipped 2% YoY to RM1.56 billion, while earnings before interest, tax, depreciation and amortisation (EBITDA) for the quarter improved 4.4% to RM735 million (Q1 2016: RM704 million) or a 44% margin.
Consequently, PAT (profit after tax) rose 5.5% to RM421 million (Q1 2016: RM399 million).
“In spite of intense competition in the industry, we continued to build a strong postpaid portfolio by delivering relevant smart plans and digital services on a high-quality 4G LTE (Fourth Generation/ Long-Term Evolution) network, and innovations that put customers in charge of their digital experience,” said chief executive officer Albern Murty (pic).
“Customers have full control in managing their accounts, deciding on their own Internet usage or sharing with others, and more at their fingertips.
“This comprehensive proposition has unlocked growth opportunities for us with postpaid customers who are increasingly confident we can deliver this kind of value to them,” he declared.
As of Q2 2016, its 4G LTE and 4G LTE-A network footprint covered 76% and 34% of the population nationwide respectively.
This has resulted in higher usage of Internet services among customers, with increased data traffic to 27% on its 4G LTE network compared with 6% a year ago, the company said.
Active Internet subscribers rose steadily to eight million, representing 64.5% of the total subscriber base, while smartphone adoption increased to 62% and 4G LTE subscribers grew 395,000 to 3.3 million.
This drove Internet revenue up to 36.1% of total service revenue for the quarter, Digi said.
The company announced a second interim dividend of 5.4 sen per share equivalent to RM420 million or a 100% payout ratio that it will pay to shareholders on Sept 30.
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