Green Packet loss soars on higher costs

Friday May 14, 2010







PETALING JAYA: Green Packet Bhd posted an after-tax loss of RM44.75mil in the first quarter ended March 31, compared with an after-tax loss of RM22.55mil in same period last year, mainly due to the higher amortisation and depreciation cost, and increased subscriber acquisition costs.



However, the company posted a revenue of RM86.82mil, which represented an increase of 109.2% compared with the previous corresponding period, mainly due to higher subscriber base for the wireless broadband business and securing of new customers for the solution business.



The improved revenue was also due to the increase in revenue from the international wholesales voice business.



Group managing director and chief executive officer CC Puan said compared with the previous quarter its operating expenses had been cut by 20% with operational losses reduced by 55% to RM43.5mil.





“The revenue and EBITDA (earnings before interest, tax, depreciation and amortisation) trends are in line with Green Packet's business goals to turn EBITDA positive in 2010,” he told a press conference after its results briefing yesterday.



According to a filing with Bursa Malaysia, its after-tax loss in the first quarter was actually lower than the preceding quarter due to higher revenue and lower marketing cost incurred in the quarter under review.



The loss in the fourth quarter last year was also due to the additional provisions made for doubtful debts and impairment of long-term investments, investments in associates and inventories of about RM35.33mil.



To date, its capital expenditure (capex) had reached RM506mil and the remaining capex of RM500mil will be utilised over the next two years.



Its telco arm, Packet One Networks (M) Sdn Bhd (P1), ended the first quarter with 35,000 new subscribers to a total of 175,000 subscribers, Puan said, adding that P1's network coverage had increased to 38.3% of the population as at end of the first quarter.



“We expect our total subscribers to double this year from last year, to about 280,000 with an average revenue per user of RM80.”



He said the WiMAX-embedded laptops from all major brands, including Dell, Asus, Lenovo and Acer, were expected to be launched in the second half of this year.



“This is expected to further boost our business performance,” he said.



On its expansion to Sabah and Sarawak, Puan said the company hoped to launch its services there before year-end or the first half of next year.



Asked on the possibility of the company bringing in new investors, Puan said the company was always exploring opportunities to bring in new funds.



It was reported that the largest mobile-phone operator in South Korea, SK Telecom Co, was among the foreign telecommunications companies that were interested to buy a stake in P1.


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