Maxis net profit climbs 2% in the third quarter

Strong performance: The group delivers another quarter of strong performance, driven by its agility in adapting to a rapidly changing and challenging environment. Malaysia. - Bloomberg

KUALA LUMPUR: Maxis Bhd’s net profit rose 2% to RM365mil in the third quarter ended Sept 30, from RM358mil in the same period last year due to lower depreciation.

Revenue, however, fell 3.2% to RM2.21bil in the third quarter against RM2.28bil a year ago. Earnings per share (EPS) for the period stood at 4.70 sen from 4.60 sen previously.

In the third quarter, its normalised earnings before interest, taxes, depreciation and amortisation (Ebitda) remained healthy, with a slight decrease by 4.1% to RM924mil from RM964mil in the third quarter (Q3) 2019.

Meanwhile, normalised Ebitda margin on service revenue was 47.6% against 49.7% in Q3 2019.

Maxis said in a statement yesterday that its operating free cash flow stood at RM745mil for the quarter compared to RM1.06bil in the same period last year, mainly due to two Universal Service Provision payments made to MCMC to support connectivity for rural communities and underserved areas, as well as increased investments in network and working capital management improvements.

The board of directors declared a third interim single-tier tax-exempt dividend of 4.0 sen per ordinary share in respect of the financial year ending Dec 31, to be paid on Dec 23. The entitlement date for the dividend payment is Nov 30.

The total dividends declared for the nine months ended Sept 30 was 12.0 sen per ordinary share.

In the first nine months to Sept 30, the telco saw its net profit fall 8.4% to RM1.066bil, or 13.60 sen EPS against RM1.164bil, or 14.90 sen EPS in the same corresponding period last year.

Revenue for the nine months stood at RM6.7bil from RM6.72bil a year ago.

Maxis CEO Gökhan Ogut said the group delivered another quarter of strong performance, driven by “our agility in adapting to a rapidly changing and challenging environment.”

“Keeping our employees, customers and the communities safe continues to be a priority while we focus on providing reliable connectivity and an unmatched personalised experience.

“For enterprises, we are committed to developing innovative solutions and being a key partner in helping them achieve their digital ambitions. We are doubling down on our convergence, fibre and enterprise strategy to continue to create value for our stakeholders, ” he said in a statement on Friday.

Maxis said it had a stable underlying service revenue (excluding wholesale) at RM1.93bil, up 0.5% from Q3 2019, driven by growth in core mobile business and fibre segment.

It said its subscriber base increased by 6.8% to 3.5 million users, largely a result of strong prepaid-to-postpaid migration as customers step up for higher value tiers especially Hotlink Postpaid.

Maxis’ postpaid revenue was lower by 2.3% at RM956mil. Postpaid average revenue per user (ARPU) fell RM90 to RM84 per month, as a result of reduced Mobile Termination Rate (MTR), Covid-19 impact on international roaming and the dilution from increasing Hotlink Postpaid entry level subscribers.

Its prepaid ARPU remained stable at RM40 per month, despite the MTR reduction since January 2020.

The segment’s revenue declined by 9.7% to RM717mil, while subscription base was slightly down by 6.6% to 5.9 million. Maxis said this was due to continued SIM consolidation and successful conversion of customers onto the Hotlink entry point postpaid service.

Maxis said it registered strong growth in fibre, with 23.3% increase in fibre connections year-on-year, bringing the total to 424,000.

As most of the subscriptions were of the lower tier, Maxis experienced a slight decrease in ARPU to RM104 per month from RM108 per month in Q3 2019.

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