PETALING JAYA: DiGi.Com Bhd posted a net profit of RM331.4mil for the first quarter ended March 31, which was 19% higher than RM278.3mil in the same period last year on higher revenue.
Its revenue stood at RM1.43bil, an increase of 11% compared with RM1.29bil a year ago.
In a filing with Bursa Malaysia, DiGi said the higher revenue was mainly contributed by increased usage from the larger subscriber base of 8.8 million, and increased data revenue that grew 38% year-on-year to RM361.7mil as well as revenue contribution from handset-bundled offerings.
Its earnings before interest, tax, depreciation and amortisation (EBITDA) and EBITDA margin stood at RM657.2mil and 45.9% respectively, which was higher than the RM575.8mil and 44.6% recorded in the preceding year’s same quarter.
“These marked improvements were a cumulative result of the group’s on-going efforts aimed towards operational excellence, over and above the previously highlighted strong revenue growth for the current quarter,” it said.
However, its average revenue per user declined slightly to RM50 from RM53 last year, a result of new customers coming in at lower spend levels, competitive price pressure as well as reduced domestic interconnect revenue following the lower regulated mobile termination rate which took effect beginning July 2010.
The board of directors has declared a first interim tax exempt (single-tier) dividend of 43 sen per ordinary share in respect of the financial year ending Dec 31, 2011.
DiGi chief executive officer Henrik Clausen said: “We have seen a steady increase in demand for mobile Internet over the past few quarters, and have put in place a strong network transformation programme to continue delivering increased network quality, efficiency and coverage, to adequately meet our customers’ demands in all parts of Malaysia.”
He said in a statement that the group had over 4.5 million internet users now and it foresaw that demand for data services would continue to trend up going forward.
In terms of outlook for the remaining quarters of 2011, the group maintains its target to achieve high single digit revenue growth. It will continue to leverage on the success of its current operational excellence focus to drive further margin improvement.
“Network investment will now be carried out in accordance with the planned network modernisaton programme with completion expected in 2013. Due to favourable pricing levels, the group anticipates capital expenditure spend for 2011 will be around 10% lower than 2010, giving rise to improved operating cashflow for the year,” the group said.
“As the network modernisation programme will result in the replacement of existing equipment on our network, the board highlights that the group will undertake to accelerate depreciation related to these existing equipment in line with generally accepted accounting practices beginning from next quarter.
Therefore, the group’s net profit will be impacted; corresponding to the quantum of accelerated depreciation to be reflected in our books over the next 21 to 33 months,” it added.
The estimated accelerated depreciation will approximate RM400mil to RM450mil in 2011, RM500mil to RM550mil in 2012 and less than RM100mil in 2013; “subject to periodic reviews and re-assessment; of which the board will notify the market accordingly.”
The company said “the accelerated depreciation will not have any adverse impact on the group’s operating cash-flow in the years mentioned.”
“These targets will be reviewed periodically and it is internal management targets and are not estimates, forecasts or projections. In addition, these internal targets have not been reviewed by our external auditors,” Digi said.
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