TM back in the black

PETALING JAYA: Telekom Malaysia Bhd (TM) has reported a net profit of RM261.3mil in the third quarter ended Sept 30,2019 (3Q19), underpinned by its cost-management initiatives carried out since last year.

TM group chief executive officer Datuk Noor Kamarul Anuar Nuruddin said overall in 3Q19, the group saw continued improvements in its fundamentals.

The net profit of RM261.30mil was a turnaround from a year ago when it posted net loss of RM175.59mil.

TM said revenue dipped 3.2% to RM2.85bil compared with RM2.94bil a year ago due to a decline in voice, Internet and multimedia services, as well as other telecommunications-related services. Earnings per share was at 6.95 sen compared with a loss per share of 4.67 sen a year ago.

The bottomline showed a vast improvement as depreciation, impairments and amortisation declined to RM572mil from RM1.573bil a year ago.

Ongoing cost optimisation has resulted in higher operating profits before finance cost, a 230.5% (RM737mil) increase to RM417.2mil from the operating loss of RM319.8mil in 3Q18, which included an impairment loss on network assets.

Correspondingly, group profit after tax and minority interest (Patami) increased 248.8% (RM436.9mil) from a loss of RM175.6mil to a profit of RM261.3mil, TM said.

Noor Kamarul said cost-management initiatives under its performance improvement plan carried out since last year continued to yield results with profitability improvement.

“We have managed to keep a close eye on our operational efficiencies to deliver sustained profitability with lower year-to-date operating expenditure/revenue, ” he said.

However, he pointed out that in line with sector contraction, TM’s revenue challenges still persisted on the retail front, in line with its expectations and 2019 market guidance.“Our capital expenditure (capex) for year-to-date September 2019 is well within guidance, totalling 8.8% of revenue, and on track as we continue our targeted investments to ensure we deliver better service experience for all our customers, ” he said.

Noor Kamarul said TM continues to offer attractive unifi products and promotions to acquire more customers, whilst addressing Streamyx customers and coverage pain points with price adjustments and its wireless offerings.

As for unifi, revenue decreased 10.9% (RM144.4mil) from RM1.33bil to RM1.18bil in the current quarter due to a reduction from voice and Internet and multimedia services, partly from the impact of the Streamyx price adjustment which took effect in September 2019 onwards as part of TM’s commitment to its loyal customers.

At RM79.8mil, unifi recorded an increase in earnings before interest and taxes (Ebit) compared to a loss of RM784.9mil in the corresponding quarter last year, which included impairment losses recognised on network assets.

For the nine months ended Sept 30,2019, TM said it registered a net profit of RM683.77mil compared with RM83.49mil in the previous corresponding period.

Its revenue dipped 3.8% to RM8.40bil from RM8.73bil – in line with guidance – mainly due to a lower contribution from all lines of products except data and non-telecommunications-related services.

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