Axiata Group recorded a profit before tax of RM253 million for the first quarter ended 31 March which was significantly lower compared to the RM361 million the group registered in 2021. Revenue came in at RM6.46 billion compared to RM6.06 billion in the previous year.
On an underlying basis, revenue excluding devices and EBITDA increased by 7.8% and 7.4%, mainly contributed by all OpCos except Ncell. EBITDA margin stood at 44.8%, whilst EBIT expanded by 44.5%. Underlying PATAMI soared by 70.7% carried by higher EBITDA contribution across all OpCos except Ncell and the absence of accelerated depreciation of 3G assets in 2022, whilst being offset by the higher tax.
On a reported basis, the company posted steady growth in revenue and EBITDA which were up by 6.7% and 7.7% year-on-year on the back of contributions from all OpCos except Ncell, despite bracing against external impacts such as headwinds in Sri Lanka and macroeconomic uncertainties stemming from the slowing of major economies. Profit After Tax and Minority Interest plunged significantly due to unrealised foreign exchange losses primarily at the Dialog and Axiata levels, as well as higher tax contributions due to the one-off Cukai Makmur.
During the quarter, Axiata achieved cost excellence through capital expenditure and operational expenditure savings of RM163 million and RM78 million, adding up to RM241 million in total savings. The Group’s balance sheet held steady with Gross debt/EBITDA within the target limit at 2.49x, net debt/EBITDA at 1.99x, and a cash balance of RM5.8 billion. Capital structure was well-managed amidst the challenging macroeconomic backdrop, where 45% of loans were in local currency, 60% on fixed rate, and 65% with more than two years of maturity.
Sri Lanka’s Dialog, despite the 16.6% increase in revenue ex-device attributed to strong growth across all segments of mobile, fixed broadband, and TV, PATAMI flipped to a loss of LKR15.8 billion, impacted by non-cash forex loss arising from USD-denominated debt.
Dato’ Izzaddin Idris, President & Group Chief Executive Officer of Axiata said, “On balance, given the challenging externalities, we landed the first quarter of 2022 on a steady footing. We are cautiously optimistic in our outlook for the rest of 2022 whilst externalities may persist in the medium-term. In addition to exercising prudence in our existing businesses through cost and operational efficiencies, we are doubling down to extract value from our deals. These involve the expansion of edotco’s tower business in the Philippines, Boost’s digital bank licence from Bank Negara Malaysia and in Indonesia, the Hipernet Indodata, and proposed Link Net acquisitions,” he said.
