KUALA LUMPUR: Announcing its first financial results since the completion of the merger, Digi.Com Bhd (CelcomDigi) said the company will draw on its combined strength to position itself for the future.
In a statement, CelcomDigi CEO Datuk Idham Nawawi said the immediate focus was on strenghtening core and new revenue growth areas while delivering a quality Internet experience to customers.
“CelcomDigi is well placed to serve the diverse needs of Malaysian consumers and businesses through our widest and highest capacity network.
"Looking ahead, we expect continued growth in data usage, primarily in 4G services, supported by initial adoption of 5G technology and increasing use of digital services and platforms," he said.
Idham added that service revenue was expected to maintain its growth momentum in 2023 while earnings before interest, tax, depreciation and amortisation (Ebitda) was projected at a flat to low single-digit increase.
He said capex-to-total revenue ratio was expected at 15% to 18%.
In the financial year ended Dec 31, 2022, CelcomDigi's net profit was RM763.5mil, down from RM1.16bil in the previous year.
According to the group, this was owing to additional depreciation and finance costs resulting from the harmonisation of accounting policies and estimates and the merger respectively, as well as the Prosperity Tax.
"Profit after tax excluding the harmonisation adjustments, merger-related one-offs, and Cukai Makmur for FY22 would have been RM1.2bil, at a margin of 17.8%," it said in a note filed with Bursa Malaysia.
The board declared a fourth interim dividend of 3.1 sen per share, which brought its full-year payout to 12.2 sen per share.
In FY22, total costs for the group increased 13% with the inclusion of RM356mil of Celcom’s December 2022 costs and the one-offs of RM196 mil.
"Excluding Celcom’s costs, COGS reduction of 6% was mainly from lower device and digital costs in line with the softer revenue momentum in both device and digital businesses whilst opex increase of 13.2% was impacted by the one-offs, network and IT modernisation costs as well as higher staff costs," it said.
The group said revenue for FY22 was RM6.77bil, up from RM6.34bil in FY21.
Meanwhile, CelcomDigi said service revenue in FY22 rose to RM5.77bil following the inclusion of RM491mil from Celcom's one-month contribution.
Excluding Celcom’s contribution, the full-year service revenue contracted 1.1% to RM5.28bil from RM5.34bil a year ago.
"This was slightly below the management’s previous guidance of service revenue to 'Return to growth' as the solid growth in postpaid, fibre and enterprise were unable to compensate for prepaid’s decline upon the conclusion of Jaringan Prihatin and ongoing macro pressures affecting consumption power.
"Fibre and enterprise businesses continued their strong trend with upticks of 300% and 15.1% respectively signalling healthy underlying growth in these segments," it said.
In the fourth quarter of 2022 alone, CelcomDigi said service revenue recorded a 37.2% increase year-on-year (y-o-y) to RM1.81bil, underpinned by strong contribution from its postpaid, enterprise and fibre businesses.
The group's Ebitda in 4QFY22 excluding non-recurring items was RM971mil with margin at 44.5%.
The total subscriber base expanded to 20.3mil during the quarter, comprising 66.8% prepaid subscribers, 32.9% postpaid subscribers and a small, fast growing fibre base at 0.3%.
After combining the postpaid subscribers of both operations, there was a net addition of 150,000 y-o-y to a total of 6.67 million, where prepaid subscriber base grew 162,000 y-o-y to 13.54 million.
It said blended average revenue per user for Digi and Celcom remained stable at RM40 and RM46 respectively on the back of steady demand for all mobile offerings.
