Axiata Group Berhad has delivered another resounding quarter on the back of higher uptake of mobile connectivity despite lingering pandemic impacts on the economic and business environments.
Its 3Q21 revenue increased to RM6.5 billion (+7.1%) and EBITDA margin remained stable at 43.7% on a Year-On-Year basis on the back of contributions from XL (Indonesia) Dialog (Sri Lanka), Robi (Bangladesh), and Axiata Digital (Malaysia).
Profit After Tax and Profit After Tax and Minority Interest however remained flat at RM463 million and RM350 million. Underlying PATAMI improved to RM394 million (+7.3%).
On a Year-To-Date basis, reported revenue increased by 5.9% driven by all OpCos except for Ncell (Nepal). EBITDA growth of 5.5% was largely in line with revenue whilst PATAMI rose 13.2% flowing through from higher EBITDA and lower net finance cost and taxation, offset by the absence of one-off gains at XL and accelerated depreciation of 3G assets for Celcom and Robi. PATAMI margin was at 3.7%.
Among the telcos, Celcom maintained its growth momentum, with an addition of approximately 1 million subscribers. Revenue ex-device YTD increased 4.6% driven by strong prepaid performance and sustaining postpaid momentum.
Meanwhile, XL’s revenue ex-device and EBITDA YTD were flat amidst competitive pressures in 1Q21 and higher sales and marketing expense. Driven by solid data revenue growth, Robi’s revenue grew by 8.1% spurred by data revenue in tandem with higher data subscribers and usage. Delivering consistent performance despite macro headwinds in Sri Lanka, Dialog sustained its momentum YTD with double-digit growth in revenue +19.5%.
Boost Life users grew to approximately 9.4 million (+8.0%), while total merchants grew to approximately 370,000 (+1.3x) YoY. The mobile wallet app, approved 11,042 financing contracts amounting to RM221 million (+379.0%) YoY. Under micro-insurance, a total of 19,531 policies (+202.0%) were sold.
Axiata’s tower business, edotco maintained its solid trajectory, recording 3.9% growth in YTD revenue and adding approximately 2,800 gross new towers, driven primarily by orders from Bangladesh market, and further supported by Malaysia, Cambodia and Pakistan markets.
Commentaries
Tan Sri Ghazzali Sheikh Abdul Khalid, Chairman of Axiata said, “Equipped with a solid operating model to tackle business opportunities and challenges, we are also deeply committed to supporting recovery and growth across our markets as societies emerge from the devastation of the pandemic to find their footing in the new digital normal.”
“Thus, it gives me great pleasure to announce that Axiata has pledged RM115 million for the next 10 years to Axiata Foundation to further expand the Education Pillar, which is anchored by the Axiata Young Talent Programme in order to advance skills and knowledge required by Malaysian youths to thrive in the digital economy.”
Dato’ Izzaddin Idris, CEO added that the group will be keeping a close watch for the coming quarter on potential inflationary pressure on SIMs and delay in network equipment delivery due to the global supply chain disruption.
As for the 5G rollout in Malaysia, Axiata is committed to supporting the Government’s move.
“Business-wise, we’re optimistic about improved data monetisation for Digital Telcos, the sustained growth momentum of Axiata Digital’s businesses as well as a pickup in site roll-outs for edotco with the easing of lockdown restrictions across markets.”
“In line with the steady performance and potential upsides, 2021 revenue excluding device and EBITDA growth are projected to be ahead of Headline KPIs at mid single digit percentage growth for both” he concluded.
