Weak consumer market continues to affect Astro’s earnings

HLIB Research said the results shortfall was mainly due to weaker-than-expected subscription revenue and merchandise sales.

PETALING JAYA: Although Astro Malaysia Holdings Bhd continues to provide greater value for its content bundles with each new subscription-based video-on-demand service including any future lifestyle app additions, analysts say it will still take some time before things start to turn around for the group.

Hong Leong Investment Bank (HLIB) Research said Astro’s core profit after taxation and minority interests (patami) for the second quarter of financial year 2024 (2Q24) declined by 54% year-on-year (y-o-y) to RM49.5mil, bringing the sum for the first half of FY24 (1H24) to RM123.6mil.

“The results missed our consensus expectations at 36% and 39% of full year forecasts, respectively. The results shortfall was mainly due to weaker-than-expected subscription revenue and merchandise sales.

“Astro’s 1H24 core patami was arrived at after adjusting for foreign exchange (forex) loss, gain on disposal of unit trust and fair value gain on derivative arising from interest rate risk and forex risk,” the research house said in a report yesterday.

On a quarter-on-quarter (q-o-q) basis, HLIB Research said the decline across the board in TV (down by 2%), radio (down by 7%) and home shopping (down by 5%) led to the decrease in Astro’s revenue by 2% to RM869.8mil.

Core patami also dropped by 33% q-o-q to RM49.5mil due to earnings before interest, taxes, depreciation, and amortisation margin contraction by two percentage points with higher licences, copyright and royalty fees, staff related costs, content costs and broadband costs.

“TV fell due to weaker subscription and advertising revenue. Reduction in radio was also due to weaker advertising expenditure as the previous quarter was boosted by major festive seasons,” the research house said.

Subscribe now to our Premium Plan for an ad-free and unlimited reading experience!

Next In Business News

Asia hedge funds avert China turmoil with bets on Japan and AI
Ringgit lower against dollar for third straight day
Bursa Malaysia derivatives to launch its first currency futures on Dec 11
Mercedes-Benz introduces latest EV offerings in Malaysia
Moderate growth in sales and launches
Axiata targets more gains from capital expenditure
Banking sector’s asset quality remains robust
BMW and Mercedes-Benz duel to be No. 1 importer
M&A deals in S’pore and Hong Kong to rise
Critical Holdings IPO oversubscribed by 88.08 times

Others Also Read