TM sets 25-30% of revenue for capex

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KUALA LUMPUR (April 26): Telekom Malaysia Bhd (TM) plans to allocate 25% to 30% of its revenue this year on capital expenditure spent primarily on fiberisation and expanding its mobile business.

Group chief financial officer Nor Fadhilah Mohd Ali said TM had spent 22.8% of its FY2017 revenue of RM2.76 billion on capex last year, and anticipates FY2018's capex to be larger owing to an increase in revenue.

"We expect 3-4% growth in revenue for this year, driven by the convergence of all our services," she told a press conference at TM's annual general meeting today.

TM is in the midst of a two-year strategic plan to consolidate all its services including high speed broadband, tv and mobile under one brand, Unifi.

Managing director and group chief executive officer Datuk Seri Mohammed Shazalli Ramly said the group will focus on being a full convergent telecommunications service provider and that the convergence of services was initiated to increase its average revenue per customer by capitalising on household customers already secured, and cross-selling its other services.

"We made a very big decision in the second half of 2017 to consolidate, positioning away from being a standalone play for all our respective brands inclusive of mobile Unifi, Wifi, home broadband and video (tv). We have spent the last six months building up on that capability," he said.

Most standalone mobile services have declining average revenue per user, he observed, adding TM is trying to avoid the trend.

As TM has 2.3 million subscribers to its home broadband under Unifi and Streamyx, he said the group aims to have at least 50% of its household customers subscribe to at least three of its services.

"TM is positioned to deliver that (service consolidation) largely because we have all the capabilities now," he said, adding a well-executed programme would give TM more opportunities than its competitors.

"This dynamic transformational change will be the precursor of the new Telekom Malaysia in the next few months," he remarked and assured of "a better customer service experience".

TM's consolidation programme would entail a unified approach in the company's marketing and advertising of all its services.