KUALA LUMPUR (July 12): Digi.Com Bhd saw net profit in the quarter ended June 30, 2019 (2QFY19) rise 2.12% to RM392.38 million, from RM384.34 million a year earlier, on deferred tax overprovision, which helped mitigate lower revenue and higher depreciation and amortisation incurred in the period.  

The telco provider also saw lower expenses in the quarter, driven by its efficiency initiatives and supported by the absence of a RM40 million restructuring cost — which mitigated the higher finance costs, its company filing showed.  

Quarterly earnings per share (EPS) rose to 5.05 sen, from 4.94 sen in 2QFY18. 

Digi has declared a second interm dividend of 5 sen per share or RM389 million, up from 4.9 sen in the same period last year, payable on Sept 27. Total dividend for the first half of FY19 however, remained lower on-year at 9.3 sen, from 9.8 sen in 1HFY18. 

In a separate statement, Digi said its margin for earnings before interest, tax, depreciation and amortisation (ebitda) increased to 49% in the quarter, from 47% previously.  

This was underpinned by its focus on driving sustainable postpaid and internet growth, while delivering on efficient cost management, it added. 

Quarterly revenue however slipped 4.3% to RM1.55 billion from RM1.6 billion previously, as a 13.2% decline in prepaid revenue offset its gains in postpaid revenue. 

For the six-month period ended June 30, 2019 (1HFY19), Digi’s net profit was 4.73% lower at RM733.98 million from RM770.45 million in the same period last year. Half-year revenue declined 6.01% to RM3.06 billion, from RM3.25 billion previously.

Digi said the slower data revenue growth from prepaid challenged by prolonged intense data competition, coupled with effects from regulatory changes in interconnect rates and continued decline from legacy mobile services, trimmed overall growth trajectory.  

“Consequentially, service revenue growth and ebitda growth guidance for 2019 is now revised to low single digit decline, in line with 1HFY19 performance although anticipating improving sequential performance in 2HFY19,” the company added.

To-date, Digi said its network now connects 11.4 million subscribers, serving populated areas across Malaysia with 90% 4G LTE coverage, 70% LTE-A coverage and 9,100km of fiber network. 

“We aim to deepen our customer insights capabilities and digitalisation efforts to drive differentiated customer experiences, connecting more Malaysians with services that matter most to them,” said Digi’s chief executive officer Albern Murty. 

“We have started executing on this strategy and remain resilient in the midst of challenging market conditions,” Murty added.  

Shares of Digi closed unchanged at RM5.05, giving the telco group a market capitalisation of RM39.26 billion.