KUALA LUMPUR (Feb 25): Telekom Malaysia Bhd's (TM) net profit for the fourth quarter ended Dec 31, 2021 (4QFY21) fell 69.2% to RM79.94 million from RM259.44 million in the same period of the previous year.

TM attributed the drop in profit to a RM122 million impairment of the group's mobile assets, the accelerated depreciation that the group commenced in the current quarter as well as provisions recognised for restoration of services and network affected by floods at the year end.

These were in addition to a RM37.9 million lower foreign exchange translation gains on borrowings, and the application of the 33% Cukai Makmur tax rate on the group's deferred tax liabilities.

Quarterly revenue, however, was up 5.06% to RM3.15 billion from RM3 billion in the same period a year ago with strong increase in revenue from internet and data.

TM group chief executive officer Imri Mokhtar noted the telco's revenue growth is expected to remain intact, in line with its market guidance, which is between low- and middle-single-digit growth. Its earnings before interest and tax (EBIT) are projected to be more than RM1.8 billion, driven by TM's three lines of business, namely Unifi, TM ONE and TM Wholesale.

"We expect to invest between 14% and 18% of our revenue this year on capital expenditure, reflecting our continued commitment to reinvesting in growth areas, capability, and capacity building, as well as enhanced customer experience," he said.

For full FY21, TM's net profit slipped nearly 12% to RM895.21 million from RM1.02 billion in the previous year, although its revenue grew 6.35% to RM11.53 billion from RM10.84 billion.

The telecommunication giant also declared an interim single-tier dividend of six sen per share for FY21, payable on Mar 31, 2021, its filling with the local bourse showed. 

The total dividend for FY21 is 13 sen per share, compared with 14.3 sen declared for FY20.

On prospects, TM said 5G presents new opportunities for the group to offer compelling converged services in enriched content and cloud-based smart services for Unifi and TM ONE customers.

This, TM said, is well prepared and committed to supporting the national 5G agenda and seamlessly transitioning its customers to these new services.

TM further noted it continues to drive wholesale business for both domestic and international segments via TM Wholesale.

"Domestically, as the preferred fibre service provider, TM Wholesale will continue to pursue 4G and 5G fibre infrastructure deployment as well as promoting collaboration with domestic service providers.

"The 10-year fibre leasing service agreement with Digital Nasional Bhd has proven TM's commitment to opening access to TM Wholesale services in providing connectivity services and end-to-end solutions, to enable excellent wireless solutions and services.

"Globally, TM Wholesale continues with its aspiration to become a digital hub for the ASEAN region through strategic collaborations with hyper-scalers and global service providers in Malaysia," it said.

In a separate statement, Imri said TM has shown positive results, driven by the New TM Transformation Programme which delivered overall growth in TM's revenue and EBIT for FY21.

"As TM enters its second year of transformation in 2022, we are activating more programmes to ensure we quickly move forward as a growth company, and keep pace with our trajectory," he said.

Shares in TM closed one sen higher at RM5.35, giving it a market value of RM20.19 billion.