Axiata’s Q3 net profit falls to RM132.07mil

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AXIATA Group Bhd’s net fell to RM132.07million for the third quarter ended Sept 30, 2018 (18) from RM238.53 million recorded in the same period last year.

Revenue also declined to RM6 billion from RM6.2 billion previously.

In a filing with Bursa Malaysia on Nov 23, Axiata said that for the quarter under review, the ringgit strengthened against all regional currencies, leading to an adverse foreign exchange (forex) translation impact on its headline performance.

The company said profit after tax and minority interest declined 44.6% to RM132.1 million in view of higher unrealised forex loss from the translation of US dollar-denominated loan and higher finance cost.

Axiata’s Malaysian operations saw the highest improvement in revenue, increasing 9.6% to RM1.813 billion, driven by growth in prepaid revenue.

For its infrastructure division in Malaysia, the segment registered a 10% growth to RM402.4 million in revenue contribution.

For the cumulative nine months, Axiata incurred a net loss of RM3.373 billion compared with a net profit of RM884.76 million in the same period last year, on slightly lower revenues of RM17.619 billion compared to RM18.141 billion previously.

The company said it declined significantly to a loss position, as a result of a one-off loss on the derecognition of the group’s investment in India amounting to RM3.3 billion.

In a statement, Axiata president and group chief executive officer Jamaludin Ibrahim said it has been a challenging year for the group, as it was affected mainly by regional geopolitics, aggressive market conditions, as well the ringgit and regional currency depreciation.

“Our loans in US dollar were affected, whilst OpCo (operating company) currencies depreciating faster than the ringgit, impacted dividend payments to the group.

“Despite these external challenges beyond our control, the group continued to demonstrate steady underlying business performance. In fact, on a year-to-date basis, all the six OpCos performed the best in their respective markets in terms of revenue growth. We are confident of riding the waves and broadly hitting our headline KPIs for the year,” he said.

Looking ahead, Jamaludin said Axiata’s operating companies will continue to provide confidence to the group, with most companies performing better than market, in terms of revenue and EBITDA.

“But we need to continue to work harder on cost and capex management.”

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