KUALA LUMPUR (July 14): DiGi.Com Bhd reported today its second-quarter net profit fell 26.61% to RM288.04 million from RM392.48 million a year earlier as revenue dropped due to the impact of the Covid-19 outbreak.

In a statement to Bursa Malaysia today, mobile telecommunication network provider DiGi said revenue fell to RM1.45 billion for the second quarter ended June 30, 2020 (2QFY20) from RM1.55 bllion.

"Top line development was challenged by socio-economic effects of the Covid-19 outbreak," DiGi said.

"Mobile service revenue contracted by 5% quarter-on-quarter (q-o-q) and 6.1% year-on-year (y-o-y) due to weaker data monetisation as a result of industry-wide free data and softer acquisitions hampered by closure of physical channels. In addition, DiGi’s performance was also impacted by lower traditional voice and roaming revenues due to closed borders.

"Internet and digital revenue eased 2.5% q-o-q despite a y-o-y growth of 8%. This was largely supported by solid growth on overall Internet usage, demand from gaming activities, subscription management services and customised digital solutions for our increasing B2B (business-to-business) base.

"The strategic shifts undertaken to reduce reliance on traditional prepaid voice significantly changed the revenue and subscriber mix to be more Internet-centric compared to a year ago," said DiGi, which recorded a lower subscriber base of 10.6 million in 2QFY20 against challenging market conditions.

For the first half (1HFY20), DiGi said today its cumulative net profit fell to RM620.03 million, from RM733.98 million a year earlier, while revenue was lower at RM3.01 billion versus RM3.06 billion.

Looking ahead, DiGi said mobile subscriptions may continue to face headwinds given the evolving Covid-19 situation and its uncertain effect on the country’s economic outlook. DiGi said its outlook had taken into account the expected pace of market recovery and growing industry competition.

Despite registering lower net profit and revenue, DiGi declared an interim tax-exempt dividend of 3.7 sen a share for 2QFY20.

In a separate Bursa filing, DiGi said the dividend's ex- and payment dates fall on Aug 25 and Sept 25, 2020 respectively.

At Bursa's 12.30pm break today, DiGi's share price settled up five sen or 1.15% at RM4.41, with a market value of RM34.21 billion. The stock saw 698,900 shares traded.