Axiata sees technical impairment from Idea-Vodafone merger

Commenting on the appointment, Jamaludin said:

KUALA LUMPUR: Axiata Group Bhd is looking at a possible technical impairment of between RM2bil and RM3bil when the merger between its associate Idea Cellular and Vodafone takes places.

President and group CEO Tan Sri Jamaludin Ibrahim said the merger of the two telcos is likely to take place in the next quarter, with two approvals still pending.

Speaking during a press conference on Wednesday, he stressed that the group was not concerned about this as the impairment was non-cash and would not have an impact on its normalised earnings and dividend-paying ability.

Idea is currently an affiliate of the group and the dilution post merger will make it a simple investment.

The group had announced its first quarter results yesterday, recording a net loss of RM147.4mil, down from a net profit of RM239mil a year ago, mainly attributed to losses on dilution of the group’s investment in India.

The group’s revenue for the period ended March 31, 2018, also decreased by 2.3% to RM5.75bil due to unfavourable forex translation arising from the stronger ringgit, compared with the same quarter last year (1Q17), from all its major operating companies except for the Malaysian mobile operating entity.

On the group’s outlook for the year ahead, Jamaludin said they were cautiously optimistic.

“Due to the technical impairment, and if the ringgit is still strong, it will be tough.

“We are cautiously optimistic. We are still doing well in most of our companies,” he said.