Axiata posts RM1.66 bil net loss for 4Q FY18 on recognition of one-off items

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KUALA LUMPUR (Feb 22): Axiata Group Bhd posted a net loss of RM1.66 billion for the fourth quarter ended Dec 31, 2018 (4QFY18) — compared with a net profit of RM24.73 million a year ago — as the group recorded various one-off, non-cash, technical items during the quarter

The one-off expenses it recorded during the quarter include the RM3.9 billion of losses recorded by Idea Cellular, a RM1.8 billion asset write-off as a result of network modernisation at PT XL Axiata Tbk and Celcom Axiata Bhd, and foreign exchange and derivatives losses of RM0.5 billion.

Its revenue for the quarter rose marginally to RM6.27 billion from RM6.26 billion a year earlier.

Excluding the one-off items, its earnings before interest, taxes, depreciation, and amortization (Ebitda) grew 2% year-on-year to RM9.4 billion amid higher contribution from Robi Axiata Ltd, Dialog Axiata Plc and XL.

The group proposed a dividend payment of 4.5 sen per share for the quarter, bringing its full-year payout to 9.5 sen per share — in line with its commitment to revert to the dividend payout ratio seen in FY15 of 85%, compared to 64% in FY17.

For the full-year period, its net loss stood at RM5.03 billion, versus a net profit of RM909.48 million reported in the preceding year, while revenue fell to RM23.9 billion from RM24.4 billion.

"In spite of the many externalities as well as significant industry and market developments this year, Axiata continued to hold up, enabling the group to strongly deliver on its 2018 underlying operational performance," said chairman Tan Sri Ghazzali Sheikh Abdul Khalid in a statement.

As for the possible capital gains tax charge on Axiata's acquisition of Ncell Private Ltd from Sweden-based Telia Sonera that was completed in 2016, he said the group is still waiting for the full judgment to gain more clarity as there has been no official notification.

According to news reports, Ncell and its major shareholder, Axiata, have been ordered by Nepal's Supreme Court earlier this month to pay capital gains tax amounting to 61 billion Nepalese rupees (RM2.16 billion), excluding late fees and fines, for the Ncell buyout deal.

Axiata previously said none of the Axiata parties to the litigation has received the judgment and order of the Supreme Court following its ruling, nor did the group have any details about what was ordered by the court.

The acquisition marked Axiata’s entry into the Nepalese market via the acquisition of Ncell, one of the country’s top mobile operators.