CelcomDigi Bhd chief executive officer Datuk Idham Nawawi.
PETALING JAYA: CelcomDigi Bhd expects a stronger performance from its financial year ending Dec 31, 2025 (FY25) onwards, as integration costs and accounting adjustments wind down.
The mobile network operator reported its fourth-quarter financial year 2024 (4Q24) results yesterday, with earnings impacted by non-recurring merger-related costs, leading to a 64% decline in bottom line compared to the previous corresponding quarter.
However, chief executive officer Datuk Idham Nawawi said in a statement the integration cost was now largely behind it, hinting at growth in the coming financial years.
“A substantial part of the overall integration cost and the merger-related non-recurring financial accounting adjustments are now behind us,” said Idham.
“We now look forward to a more robust and positive financial and market performance from 2025 and beyond.”
With cost efficiencies flowing through from the integration initiatives, CelcomDigi is expected to deliver annual cost savings of between RM700mil and RM800mil post-2027.
For 4Q24 ended Dec 31, 2024, CelcomDigi reported a net profit of RM157.04mil, down 63.9% from RM435.15mil in the same quarter last year.
This was despite revenue remaining flat at RM3.28bil, marking a marginal 0.04% increase.
Idham attributed the decline in earnings primarily to impairment and accelerated depreciation charges of right-of-use assets for network sites, following a reassessment of their useful life.
This was partially offset by a reversal of tax over-provisions. For FY24, CelcomDigi posted a net profit of RM1.38bil, down 11.3% from RM1.55bil in FY23, while revenue remained unchanged at RM12.68bil.
“One-off merger-related financial adjustments caused reported earnings before interest and tax (Ebit) and profit after tax (PAT) for FY24 to decline by 13.4% and 11.4%, respectively.
“However, excluding these non-recurring adjustments, full-year normalised Ebit and PAT registered strong growth of 4% and 11.6%, respectively, driven by stringent cost management and synergy savings,” it said.
In FY24, the telecommunications company saw its Ebit fall 13.4% to RM2.33bil, sharper than its guidance of a “single-digit decrease.” Capital expenditure reached RM2.37bil, or 18.71% of revenue, slightly above the guidance of 15% to 18%.
CelcomDigi’s total costs rose 5.7% year-on-year due to higher roaming traffic, device sales, and increased lease line and fibre-related expenses.
Earnings before interest, taxes, depreciation and amortisation margin declined to 45.7% in FY24 from 48.5% in FY23.
The company declared a fourth interim dividend of 3.7 sen per share, payable on March 27, 2025, bringing total dividends for FY24 to 14.3 sen per share, up from 13.2 sen in FY23.
“We remain committed to our dividend policy of distributing 80% of PAT,” Idham said.
CelcomDigi said it ended the year with about 20.4 million subscribers and an improved blended average revenue per user of RM42.
The company is integrating over 50 different information technology domains, with 20 completed.
Additionally, 48 stores were refreshed last year as CelcomDigi moves forward as a single entity under one brand.
Looking ahead, Idham said CelcomDigi expects low single-digit growth in service revenue, low to mid-single-digit growth in Ebit and a capital expenditure-to-revenue ratio of 14% to 16%.
“We are strengthening our market leadership across all businesses, monetising our base through value-added services, and driving operational excellence through cost structure optimisation,” Idham said.
“We will continue to invest for the future.”
Service revenue in FY24 slipped 0.6% year-on-year to RM10.79bil.
Over the financial year, postpaid revenue grew 2.6% year-on-year (y-o-y) to RM4.18bil on the back of subscriber growth of 374,000, due to enhanced convergence plans.
Prepaid revenue recorded a slower decline of 3.4% to RM4.42bil, with slower subscribers losses of 23,000 quarter-on-quarter, marking signs of a turnaround from effective base management.
