This article first appeared in The Edge Financial Daily on December 5, 2019

KUALA LUMPUR: Astro Malaysia Holdings Bhd posted an 11.5% rise in net profit to RM170.85 million or 3.28 sen per share for the third quarter ended Oct 31, from RM153.22 million or 2.94 sen per share last year owing to lower net finance charges and tax expenses.

However, revenue declined 12.18% to RM1.22 billion, from RM1.38 billion last year, amid a decrease in subscription revenue, production revenue, sales of programming rights and advertising revenue, said Astro in a filing with the local stock exchange yesterday.

The group declared a third interim dividend of two sen per share for the financial year ending Jan 31, 2020, payable on Jan 3 next year. The proposed dividend is lower than the 2.5 sen paid for the same period last year, the improved performance notwithstanding.

For the cumulative nine months, net profit jumped 49.88% to RM516.38 million or 9.9 sen a share, from RM344.52 million or 6.61 sen a share last year, although revenue slipped 10.34% to RM3.69 billion, from RM4.11 billion.

The earnings improvement for the period was mainly due to lower FIFA World Cup content cost, and marketing and distribution expenses, as well as reduced net finance charges.

The pay TV operator said the market remains challenging with structural changes in the global content, media and advertising industries, including threats of piracy and streaming wars.

It will continue to strengthen its core Pay TV and NJOI businesses by redefining customer value propositions, elevating customer service, refreshing and aggregating the best content and streaming services, the company said, adding that it will also leverage its customer base to build new revenue adjacencies in commerce, broadband, digital and OTT (over-the-top), while maintaining disciplined cost optimisation.

“Despite a challenging media landscape, Astro continues to deliver solid Patami (profit after taxes and minority interest) growth as we continue our journey to improve customer service, refresh our content, as well as enhance home entertainment and personalisation on Astro GO,” said its chief executive officer Henry Tan in a separate statement yesterday.

“The newly launched Ultra Box saw good response with over 10,000 orders to date. iQiyi launched its first app partnership outside China, with Astro taking the lead in marketing, customer acquisition and media sales.

“With greater emphasis on video streaming services, we now have three exclusive streaming services — Astro GO, HBO GO and iQiyi.”