DiGi Q2 profit shrinks 15%

Dylan Bushell-Embling
telecomasia.net

Malaysia's DiGi has reported a 15% slump in Q2 profit, as depreciation costs and one-off charges wiped out healthy revenue and customer growth. 

The nation's third largest mobile operator said its profit declined to 278 million ringgit ($92.7 million), despite the 10% growth in revenue year-on-year to 1.46 billion ringgit.
 
Ebitda increased a healthy 16.3%, but depreciation and amortization costs soared to 323.8 million ringgit from just 192.7 million ringgit a year earlier. Finance costs nearly doubled.
 
DiGi's revenue growth was driven by a 113% surge in mobile data revenue to 151 million ringgit. Around 17% of the operator's total customer base are now smartphone users.
 
Also contributing was the addition of 447,000 new customers during the quarter, although 404,000 of these were pre-paid users. Postpaid net adds made up the remaining 43,000, down from 56,000 in 2Q10.
 
ARPU declined to 43 ringgit per month for pre-paid users, from 47 ringgit a year ago, but grew to 84 from 83 ringgit for postpaid users.
 
The operator is forecasting high single digit revenue growth for the whole of 2011, and advised it expects capex to be around 10% lower than in 2010.
 
DiGi added that its network modernization program is on track. The company is targeting an end-2012 completion date for a RAN swap-out, which will allow it to easily transition to LTE once spectrum is available.

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