Monday, February 28, 2011
Maxis Q4 profit Up
Tuesday March 1, 2011
By LEONG HUNG YEE
hungyee@thestar.com.my
KUALA LUMPUR: Maxis Bhd's net profit rose 21.3% to RM610mil for the fourth quarter ended Dec 31, 2010 from RM503mil previously due to increased contribution from the non-voice segment and a bigger subscriber base.
Its revenue rose to RM2.31bil versus RM2.21bil previously.
“The group recorded a quarter-on-quarter revenue growth of 4% or RM94mil primarily driven by an increase in non-voice revenue by RM84mil or 10% to RM893mil. This was contributed by advanced data services, short message service and wireless broadband businesses, partially offset by reduction in interconnect revenue,” Maxis said in the notes accompanying its financial results.
The telco's profit from operations stood at RM887mil while earnings per share was 8.10 sen against 6.70 sen posted a year ago.
However, Maxis said the comparative figures did not represent a like-for-like comparison of the operational performance of the group because of the accounting treatment adopted for the business combination by Maxis, which was completed on Oct 1, 2009.
Maxis' EBITDA (earnings before interest, taxation, depreciation and amortisation) margin for the fourth quarter was lower at 50.6% against 51.4% in the preceeding quarter.
During the quarter, Maxis also declared an interim dividend of 8 sen per share and also proposed a final dividend of 8 sen per share totalling up to a RM1.2bil payout.
For the full financial year ended Dec 31 (FY10), Maxis' net profit stood at RM2.3bil on revenue of RM8.87bil. Its EBITDA margin for the year stood at 49.8%.
As at Dec 31, the company had a cash and cash equivalent of RM898mil.
Chief executive officer Sandip Das said Maxis had managed to maintain its EBITDA margin close to 50% level despite margin contraction pressure in its voice segment last year.
“The sluggishness or maturity of the voice market came much faster than we thought,” he said at a briefing yesterday.
Going forward, Das expects growth to come from data and broadband. He said the company had spent the past two years since its re-listing in late 2009 building a strong network.
“We need to build (the network) for the tsunami that's to come ... the tsunami for data and broadband,” he said, adding that Maxis managed to secure 330,000 net adds in the broadband segment in FY10 to a total of 594,000 subscribers.
As at Dec 31, Maxis' had a total of 13.95 million subscribers while its prepaid subscribers crossed the 10 million mark.
To a question, Das said expected Maxis to achieve a mid-single-digit growth revenue for FY11 to be driven by non-voice services, including data and broadband.
He said non-voice revenue was among the global best in the FY10, accounting for 41.5% of mobile revenue contribution.
“We aim to increase the contribution to 50% by mid-2012. The company will continue to maximise its mobile revenue and continue to be the leader in the market,” he said.
On capital expenditure for FY11, Das said the company planned to spend RM1.4bil, of which 40% to 50% would be used to upgrade its 3G network including fibre optic build-up, and about RM300mil for the infrastructure of its fixed line.
One focus this year would be the commercialisation of home services which would take effect next month, he said.
Among the services to be offered include IP-based services (to be delivered over high-speed broadband access), interactive television, telepresence and eHealth hosting services.
Maxis' blended average revenue per user (ARPU) stood at RM51 against RM56 a year ago.
Its prepaid ARPU fell 12% to RM36 in FY10 from RM41 previously while wireless broadband ARPU fell 30% to RM68 from RM97 in 2009.
Chief financial officer Rossana Rashidi said the prepaid ARPU was partly cannibalised due to lifetime schemes and youth plans, which were now being phased out, and revenue-enhancing plans were being introduced.
She said the lower broadband ARPU was due to promotion packages used to encourage take-up from fresh segments.
http://biz.thestar.com.my/news/story.asp?file=/2011/3/1/business/8160707&sec=business
By LEONG HUNG YEE
hungyee@thestar.com.my
KUALA LUMPUR: Maxis Bhd's net profit rose 21.3% to RM610mil for the fourth quarter ended Dec 31, 2010 from RM503mil previously due to increased contribution from the non-voice segment and a bigger subscriber base.
Its revenue rose to RM2.31bil versus RM2.21bil previously.
“The group recorded a quarter-on-quarter revenue growth of 4% or RM94mil primarily driven by an increase in non-voice revenue by RM84mil or 10% to RM893mil. This was contributed by advanced data services, short message service and wireless broadband businesses, partially offset by reduction in interconnect revenue,” Maxis said in the notes accompanying its financial results.
The telco's profit from operations stood at RM887mil while earnings per share was 8.10 sen against 6.70 sen posted a year ago.
However, Maxis said the comparative figures did not represent a like-for-like comparison of the operational performance of the group because of the accounting treatment adopted for the business combination by Maxis, which was completed on Oct 1, 2009.
Maxis' EBITDA (earnings before interest, taxation, depreciation and amortisation) margin for the fourth quarter was lower at 50.6% against 51.4% in the preceeding quarter.
During the quarter, Maxis also declared an interim dividend of 8 sen per share and also proposed a final dividend of 8 sen per share totalling up to a RM1.2bil payout.
For the full financial year ended Dec 31 (FY10), Maxis' net profit stood at RM2.3bil on revenue of RM8.87bil. Its EBITDA margin for the year stood at 49.8%.
As at Dec 31, the company had a cash and cash equivalent of RM898mil.
Chief executive officer Sandip Das said Maxis had managed to maintain its EBITDA margin close to 50% level despite margin contraction pressure in its voice segment last year.
“The sluggishness or maturity of the voice market came much faster than we thought,” he said at a briefing yesterday.
Going forward, Das expects growth to come from data and broadband. He said the company had spent the past two years since its re-listing in late 2009 building a strong network.
“We need to build (the network) for the tsunami that's to come ... the tsunami for data and broadband,” he said, adding that Maxis managed to secure 330,000 net adds in the broadband segment in FY10 to a total of 594,000 subscribers.
As at Dec 31, Maxis' had a total of 13.95 million subscribers while its prepaid subscribers crossed the 10 million mark.
To a question, Das said expected Maxis to achieve a mid-single-digit growth revenue for FY11 to be driven by non-voice services, including data and broadband.
He said non-voice revenue was among the global best in the FY10, accounting for 41.5% of mobile revenue contribution.
“We aim to increase the contribution to 50% by mid-2012. The company will continue to maximise its mobile revenue and continue to be the leader in the market,” he said.
On capital expenditure for FY11, Das said the company planned to spend RM1.4bil, of which 40% to 50% would be used to upgrade its 3G network including fibre optic build-up, and about RM300mil for the infrastructure of its fixed line.
One focus this year would be the commercialisation of home services which would take effect next month, he said.
Among the services to be offered include IP-based services (to be delivered over high-speed broadband access), interactive television, telepresence and eHealth hosting services.
Maxis' blended average revenue per user (ARPU) stood at RM51 against RM56 a year ago.
Its prepaid ARPU fell 12% to RM36 in FY10 from RM41 previously while wireless broadband ARPU fell 30% to RM68 from RM97 in 2009.
Chief financial officer Rossana Rashidi said the prepaid ARPU was partly cannibalised due to lifetime schemes and youth plans, which were now being phased out, and revenue-enhancing plans were being introduced.
She said the lower broadband ARPU was due to promotion packages used to encourage take-up from fresh segments.
http://biz.thestar.com.my/news/story.asp?file=/2011/3/1/business/8160707&sec=business
Analysts Positive On TM’s Capital Distribution
Tuesday March 1, 2011
By JEEVA ARULAMPALAM
jeeva@thestar.com.my
Cash return makes it a steady preference
PETALING JAYA: Telekom Malaysia Bhd (TM)'s proposed capital distribution of 29 sen per share has been viewed positively by telecommunication analysts, as TM returns excess cash from the disposal of non-core assets such as the sale in Measat Global Bhd shares.
In conjunction with its full-year 2010 results release last Friday, TM said it wanted to carry out a capital distribution to its shareholders of some RM1.04bil, or 29 sen per RM1 each, in line with its capital management framework to return excess cash to shareholders and given its strong cash position as a result of disposal of non-core asset.
According to the company's year to date accounts ending Dec 31, total gains of RM366.6mil were made from the disposal of Measat and Axiata Group Bhd shares.
TM also proposed a final gross dividend of 13.1 sen per share, on top of its interim gross dividend of 13 sen last September.
“Post capital distribution and final dividend distribution, TM's balance sheet is expected to remain solid due to its huge cash balance of RM3.5bil or 97.56 sen per share,” Kenanga Research said in a report yesterday.
A foreign research analyst covering TM said the capital distribution was sufficient, considering the company's commitment to dividend returns of RM700mil or up to 90% of normalised profit after taxation and minority interests.
Meanwhile, Inter-Pacific Research Sdn Bhd said that TM's financial year 2010 gross dividend total of 21.6 sen with a 29 sen per share capital distribution made it a steady preference.
Last September, TM sold 60.02 million Measat shares to Measat Global Network Systems Sdn Bhd for RM252.1mil.
In December, TM said it was looking to dispose off 191.46 million Axiata shares through private placements or the open market, which was estimated to fetch RM879.4mil in total if it sold Axiata shares at RM4.60 per share.
It subsequently managed to place out 90 million from the 191.46 million Axiata shares at RM4.60 per share, making a disposal gain of RM209.7mil.
The last capital repayment from TM to its shareholders was in 2009, as it paid out 98 sen per share or a total of RM3.51bil.
TM came into excess cash then as Axiata (then known as TM International Bhd) paid it some RM4.03bil as part of interest earned on monies according to the demerger agreement between both parties.
HwangDBS Vickers Research said that TM's fourth-quarter 2010 core earnings before interest, taxation, depreciation and amortisation (Ebitda) growth of 7% quarter-on-quarter on the back of a 6% revenue increase was within its expectation.
It added that growth for the present fiscal year's earnings would be driven by growth in the data and broadband segments as broadband demand was expected to remain robust.
“However, we understand that Ebitda margin may be slightly lower this year as the group may incur additional operating costs in rolling out the high-speed broadband,” HwangDBS said.
http://biz.thestar.com.my/news/story.asp?file=/2011/3/1/business/8155108&sec=business
By JEEVA ARULAMPALAM
jeeva@thestar.com.my
Cash return makes it a steady preference
PETALING JAYA: Telekom Malaysia Bhd (TM)'s proposed capital distribution of 29 sen per share has been viewed positively by telecommunication analysts, as TM returns excess cash from the disposal of non-core assets such as the sale in Measat Global Bhd shares.
In conjunction with its full-year 2010 results release last Friday, TM said it wanted to carry out a capital distribution to its shareholders of some RM1.04bil, or 29 sen per RM1 each, in line with its capital management framework to return excess cash to shareholders and given its strong cash position as a result of disposal of non-core asset.
According to the company's year to date accounts ending Dec 31, total gains of RM366.6mil were made from the disposal of Measat and Axiata Group Bhd shares.
TM also proposed a final gross dividend of 13.1 sen per share, on top of its interim gross dividend of 13 sen last September.
“Post capital distribution and final dividend distribution, TM's balance sheet is expected to remain solid due to its huge cash balance of RM3.5bil or 97.56 sen per share,” Kenanga Research said in a report yesterday.
A foreign research analyst covering TM said the capital distribution was sufficient, considering the company's commitment to dividend returns of RM700mil or up to 90% of normalised profit after taxation and minority interests.
Meanwhile, Inter-Pacific Research Sdn Bhd said that TM's financial year 2010 gross dividend total of 21.6 sen with a 29 sen per share capital distribution made it a steady preference.
Last September, TM sold 60.02 million Measat shares to Measat Global Network Systems Sdn Bhd for RM252.1mil.
In December, TM said it was looking to dispose off 191.46 million Axiata shares through private placements or the open market, which was estimated to fetch RM879.4mil in total if it sold Axiata shares at RM4.60 per share.
It subsequently managed to place out 90 million from the 191.46 million Axiata shares at RM4.60 per share, making a disposal gain of RM209.7mil.
The last capital repayment from TM to its shareholders was in 2009, as it paid out 98 sen per share or a total of RM3.51bil.
TM came into excess cash then as Axiata (then known as TM International Bhd) paid it some RM4.03bil as part of interest earned on monies according to the demerger agreement between both parties.
HwangDBS Vickers Research said that TM's fourth-quarter 2010 core earnings before interest, taxation, depreciation and amortisation (Ebitda) growth of 7% quarter-on-quarter on the back of a 6% revenue increase was within its expectation.
It added that growth for the present fiscal year's earnings would be driven by growth in the data and broadband segments as broadband demand was expected to remain robust.
“However, we understand that Ebitda margin may be slightly lower this year as the group may incur additional operating costs in rolling out the high-speed broadband,” HwangDBS said.
http://biz.thestar.com.my/news/story.asp?file=/2011/3/1/business/8155108&sec=business
Sunday, February 27, 2011
Saturday, February 26, 2011
TM Reinvents Mobile Strategy
Saturday February 26, 2011
By B.K. SIDHU
bksidhu@thestar.com.my
THE landscape in the country's telecommunications sector is changing ever so rapidly which has led many telco players to re-invent themselves and reverse their strategies to stay competitive.
So, when over the week, Telekom Malaysia Bhd (TM) announced its plans to partner Celcom Axiata Bhd, no one bat an eyelid. They are after all, sister companies. The tie-up closely followed a similar pact TM signed with Maxis Bhd a few weeks ago. And globally too, the trend to outsource and form tie-ups to save on capital expenditure is also picking up.
But TM's latest move has raised a question: Wasn't it only about four years ago when TM and Celcom split up into separate entities, all in the name of unlocking value?
The signs were there much earlier. Two years ago, TM's boss Datuk Seri Zamzamzairani Mohd Isa had said that mobile was an option. That stance has become more compelling lately given the surge in demand for mobile broadband and the robust growth in data traffic.
Indeed, while the fixed high-speed broadband (HSBB) network brings enormous potential for TM, it still can do a great deal more with the mobility/wireless equation. Mobility is the game changer in the world of communications even though fibre is a major component for the backhaul for exponential growth.
In a recent report, Cisco projected that mobile data traffic would increase 205 times, reaching 6.3 exabytes per month by 2015 due to a projected surge in mobile Internet-enabled devices delivering popular video applications and services. With that, capacity on current 3G networks will likely be exhausted by 2013 putting pressure on providers for additional investment in radio access and backhaul networks.
Against that backdrop, it may be easy to understand why, after operating separately for three years, TM and Celcom have decided to come together again.
The pact
TM has signed a memorandum of understanding with Celcom to explore areas where infrastructure can be shared. The parties will hammer out a definitive agreement in two months for a 10-year partnership.
The collaboration will cover access and transmission on TM's high-speed broadband (HSBB), wholesale Internet access and digital subscriber-line access. Essentially, this means that Celcom will have access to both TM's copper and fibre line while TM can tap the mobile realm by riding on Celcom's infrastructure.
“It is a sibling factor,” says Celcom CEO Datuk Seri Shazalli Ramly. Both companies share a common shareholder, Khazanah Nasional Bhd, which owns 33% of TM and 44.5% of Axiata.
Celcom has the widest coverage in populated areas for its cellular network. It also claims to have wide coverage for wireless broadband. Evidently, Shazalli has great plans for Celcom but without a fibre network, it may be difficult to realise the vision as the telco will need plenty of “dump pipes and content.''
Celcom also has a partnership with rival DiGi.Com Bhd to work together in many areas, mainly with the aim of cutting cost.
TM wants a slice of the mobile voice and data business and it wants to ride on a MVNO (mobile virtual network operator) model just like TuneTalk, XOX Bhd, Merchantrade Asia Sdn Bhd and REDtone International Bhd, instead of building an entirely new network. Many years ago, it used to own TM Touch but had eventually merged it with Celcom.
In a statement issued on Wednesday, TM says it will have an opportunity to gain access to Celcom's cellular network as a MVNO to offer its own branded mobile voice and data services to complement its existing fixed line portfolio.
(An MVNO offers mobile phone services such as phone calls and text messages but does not have its own licensed frequency allocation of radio spectrum. It also may not have the necessary infrastructure to provide mobile phone services. For example, TuneTalk rides on Celcom's network to offer cellular services.)
In the case of TM, it has the 450MHz and 800MHz bandwidth. The question is whether it is economically viable to build a whole new network or just hop on to an existing network.
Zamzamzairani says: “We are using the existing bandwidth that we have for CDMA.''
Sharing obviously has its benefits. AmResearch points out that TM would not have to overly burdened with capex to build a full-blown mobile business. Instead, it says TM will capitalise on Celcom's network via wholesale capacity purchase and operate its own subscribers franchise and monetise its own user base, which currently stands at 2.8 million of residential subscribers.
Demerger a right move?
With the latest development, the question begs itself on hindsight was it a right decision to hive off Celcom back in 2008?
Back then, Celcom used to be TM's wholly-owned unit. TM had forked out about RM4bil to buy Celcom in 2002 only to let go of the cellular unit in 2008 under a demerger exercise, along with other international cellular operations, which is now parked within Axiata Group.
“It was the right decision then. Just look at the market capitalisation that has grown. TM used to be a laggard and now it has a second chance to shine with HSBB.
“Even if Celcom was listed, it would be a worth a lot more but that's not the route Celcom will take,” says a source close to the companies.
At the point of demerger, both companies were worth nearly RM40bil. Today, Axiata is worth RM41bil and TM about RM14bil.
John Cheah the associate market analyst with IDC Malaysia says the demerger allows TM and Axiata to focus on their individual resources to excel in the fixed line and wireless markets respectively.
“Looking at the present, this new strategic partnership attempts to address the fast-evolving communications user habits. In terms of infrastructure, TM has a wide coverage, in addition to its recent HSBB network that has enabled it to provide FTTH services and fibre resale to other parties.
“As for Celcom, it currently has one of the widest wireless coverage within Malaysia and Axiata's mobile subsidiaries in other emerging Asian markets are also showing good growth,'' Cheah says.
The growth in data and video usage has beaten all projections which is placing pressure on celcos and telcos to ramp up network capacity.
Cheah of IDC says “when we look at current market, the increase in ubiquitous computing and the need for constant connectivity with mobility now calls for more converged services. Current market saturation, declining ARPU and constant capex spending have also driven the need for product and service innovation.”
“Future quad play environments that require both cellular and fixed line components is the reason behind this collaboration. IDC believes that the TM-Celcom MoU will be beneficial not only to the respective parties, but to the end users as well,'' he adds.
The shift from voice centric services to data-centric services is real.
Players like Celcom, TM, Maxis and DiGi can remain operators of dumb pipes/wireless networks or they can monetise further these pipes/networks to make more money in the future.
A report says that if telcos do not conform to the new reality, they face the risk of becoming nothing more than access only, “dump pipes utilities,'' like many of the fixed line cousins, with much of the new data related revenue growth leaking from the sector to new service providers.
“That is not to say that an access dump utility model is not sustainable in the long term but we should expect such a model to have lower financial returns than currently enjoyed from that perspectives. Operators need to try and maintain a content/service focus in the increasing data-centric world,'' the report says.
Hwang-DBS Vickers Research believes that Celcom is a bigger beneficiary of the recent tie-up given that the fixed broadband services will complement its current mobile offerings to existing subscribers.
It added that TM may have difficulty to compete with other bigger celcos (DiGi, Celcom and Maxis which collectively control 99% of the country's subscriber base), being the last to enter the MVNO market.
“Although we think the deal is positive for Celcom, near-term earnings impact would likely be minimal,'' says Hwang-DBS.
http://biz.thestar.com.my/news/story.asp?file=/2011/2/26/business/8142791
By B.K. SIDHU
bksidhu@thestar.com.my
THE landscape in the country's telecommunications sector is changing ever so rapidly which has led many telco players to re-invent themselves and reverse their strategies to stay competitive.
So, when over the week, Telekom Malaysia Bhd (TM) announced its plans to partner Celcom Axiata Bhd, no one bat an eyelid. They are after all, sister companies. The tie-up closely followed a similar pact TM signed with Maxis Bhd a few weeks ago. And globally too, the trend to outsource and form tie-ups to save on capital expenditure is also picking up.
But TM's latest move has raised a question: Wasn't it only about four years ago when TM and Celcom split up into separate entities, all in the name of unlocking value?
The signs were there much earlier. Two years ago, TM's boss Datuk Seri Zamzamzairani Mohd Isa had said that mobile was an option. That stance has become more compelling lately given the surge in demand for mobile broadband and the robust growth in data traffic.
Indeed, while the fixed high-speed broadband (HSBB) network brings enormous potential for TM, it still can do a great deal more with the mobility/wireless equation. Mobility is the game changer in the world of communications even though fibre is a major component for the backhaul for exponential growth.
In a recent report, Cisco projected that mobile data traffic would increase 205 times, reaching 6.3 exabytes per month by 2015 due to a projected surge in mobile Internet-enabled devices delivering popular video applications and services. With that, capacity on current 3G networks will likely be exhausted by 2013 putting pressure on providers for additional investment in radio access and backhaul networks.
Against that backdrop, it may be easy to understand why, after operating separately for three years, TM and Celcom have decided to come together again.
The pact
TM has signed a memorandum of understanding with Celcom to explore areas where infrastructure can be shared. The parties will hammer out a definitive agreement in two months for a 10-year partnership.
The collaboration will cover access and transmission on TM's high-speed broadband (HSBB), wholesale Internet access and digital subscriber-line access. Essentially, this means that Celcom will have access to both TM's copper and fibre line while TM can tap the mobile realm by riding on Celcom's infrastructure.
“It is a sibling factor,” says Celcom CEO Datuk Seri Shazalli Ramly. Both companies share a common shareholder, Khazanah Nasional Bhd, which owns 33% of TM and 44.5% of Axiata.
Celcom has the widest coverage in populated areas for its cellular network. It also claims to have wide coverage for wireless broadband. Evidently, Shazalli has great plans for Celcom but without a fibre network, it may be difficult to realise the vision as the telco will need plenty of “dump pipes and content.''
Celcom also has a partnership with rival DiGi.Com Bhd to work together in many areas, mainly with the aim of cutting cost.
TM wants a slice of the mobile voice and data business and it wants to ride on a MVNO (mobile virtual network operator) model just like TuneTalk, XOX Bhd, Merchantrade Asia Sdn Bhd and REDtone International Bhd, instead of building an entirely new network. Many years ago, it used to own TM Touch but had eventually merged it with Celcom.
In a statement issued on Wednesday, TM says it will have an opportunity to gain access to Celcom's cellular network as a MVNO to offer its own branded mobile voice and data services to complement its existing fixed line portfolio.
(An MVNO offers mobile phone services such as phone calls and text messages but does not have its own licensed frequency allocation of radio spectrum. It also may not have the necessary infrastructure to provide mobile phone services. For example, TuneTalk rides on Celcom's network to offer cellular services.)
In the case of TM, it has the 450MHz and 800MHz bandwidth. The question is whether it is economically viable to build a whole new network or just hop on to an existing network.
Zamzamzairani says: “We are using the existing bandwidth that we have for CDMA.''
Sharing obviously has its benefits. AmResearch points out that TM would not have to overly burdened with capex to build a full-blown mobile business. Instead, it says TM will capitalise on Celcom's network via wholesale capacity purchase and operate its own subscribers franchise and monetise its own user base, which currently stands at 2.8 million of residential subscribers.
Demerger a right move?
With the latest development, the question begs itself on hindsight was it a right decision to hive off Celcom back in 2008?
Back then, Celcom used to be TM's wholly-owned unit. TM had forked out about RM4bil to buy Celcom in 2002 only to let go of the cellular unit in 2008 under a demerger exercise, along with other international cellular operations, which is now parked within Axiata Group.
“It was the right decision then. Just look at the market capitalisation that has grown. TM used to be a laggard and now it has a second chance to shine with HSBB.
“Even if Celcom was listed, it would be a worth a lot more but that's not the route Celcom will take,” says a source close to the companies.
At the point of demerger, both companies were worth nearly RM40bil. Today, Axiata is worth RM41bil and TM about RM14bil.
John Cheah the associate market analyst with IDC Malaysia says the demerger allows TM and Axiata to focus on their individual resources to excel in the fixed line and wireless markets respectively.
“Looking at the present, this new strategic partnership attempts to address the fast-evolving communications user habits. In terms of infrastructure, TM has a wide coverage, in addition to its recent HSBB network that has enabled it to provide FTTH services and fibre resale to other parties.
“As for Celcom, it currently has one of the widest wireless coverage within Malaysia and Axiata's mobile subsidiaries in other emerging Asian markets are also showing good growth,'' Cheah says.
The growth in data and video usage has beaten all projections which is placing pressure on celcos and telcos to ramp up network capacity.
Cheah of IDC says “when we look at current market, the increase in ubiquitous computing and the need for constant connectivity with mobility now calls for more converged services. Current market saturation, declining ARPU and constant capex spending have also driven the need for product and service innovation.”
“Future quad play environments that require both cellular and fixed line components is the reason behind this collaboration. IDC believes that the TM-Celcom MoU will be beneficial not only to the respective parties, but to the end users as well,'' he adds.
The shift from voice centric services to data-centric services is real.
Players like Celcom, TM, Maxis and DiGi can remain operators of dumb pipes/wireless networks or they can monetise further these pipes/networks to make more money in the future.
A report says that if telcos do not conform to the new reality, they face the risk of becoming nothing more than access only, “dump pipes utilities,'' like many of the fixed line cousins, with much of the new data related revenue growth leaking from the sector to new service providers.
“That is not to say that an access dump utility model is not sustainable in the long term but we should expect such a model to have lower financial returns than currently enjoyed from that perspectives. Operators need to try and maintain a content/service focus in the increasing data-centric world,'' the report says.
Hwang-DBS Vickers Research believes that Celcom is a bigger beneficiary of the recent tie-up given that the fixed broadband services will complement its current mobile offerings to existing subscribers.
It added that TM may have difficulty to compete with other bigger celcos (DiGi, Celcom and Maxis which collectively control 99% of the country's subscriber base), being the last to enter the MVNO market.
“Although we think the deal is positive for Celcom, near-term earnings impact would likely be minimal,'' says Hwang-DBS.
http://biz.thestar.com.my/news/story.asp?file=/2011/2/26/business/8142791
Investment Gains Boost TM Net Profit
Saturday February 26, 2011
By JEEVA ARULAMPALAM
jeeva@thestar.com.my
KUALA LUMPUR: Telekom Malaysia Bhd (TM) saw its fourth quarter ended Dec 31, 2010 net profit more than double to RM400.63mil from RM170.25 a year ago due to higher revenue and investment gains made by the disposal of shares.
TM booked a net gain of RM213.3mil from the sale of Measat Global Bhd and Axiata Group Bhd shares attributed to lapsed ESOS options.
The company also announced plans to carry out a capital distribution to its shareholders of some RM1.04bil, or 29 sen per RM1 each, in line with its capital management framework to return excess cash to shareholders.
While the business environment for its current financial year will remain challenging due to the intense competitive landscape, TM group chief executive officer Datuk Seri Zamzamzairani Mohd Isa says the company is set to take its stage of growth to the next level.
This would be on the back of its performance improvement programme, its focus on customer centricity and as it sought to achieve 1.1 million premises passed and a total of 78 exchange areas by the end of this year under its high-speed broadband project, UniFi, he told reporters at the company's result briefing yesterday.
The company's financial year ending Dec 31, 2011 (FY11) headline key performance indicators include a revenue growth of 2.5%, earnings before interest, tax, depreciation and amortisation margin of 32% and customer satisfaction measure of 70, which uses TRI*M index measuring end-to-end customer experience at all touch points. TM was able to meet all three headline KPIs for FY10.
For the quarter under review, revenue was up 2.11% to RM2.32bil from RM2.27bil from a year ago, due to higher revenue from data, Internet and multimedia and non-telecommunications-related services, which mitigated the impact of lower revenue from voice and other telecommunications-related services.
TM said data revenue increased by 14.4% to RM490.8mil in the quarter compared with RM428.9mil previously due to demand for higher bandwidth services.
Internet and multimedia posted higher revenue by 12.6% to RM436.6mil owing to an increase in broadband customers to 1.68 million in the quarter compared with 1.43 million a year ago.
Its earnings per share was 11.2 sen.
For its full year, TM's net profit was up 88% to RM1.21bil from RM643.03mil in FY09. Its revenue was up 2.1% to RM8.79bil driven by higher operating revenue from data services, Internet and multimedia and other telecommunications-related services, which grew by 15.4%, 5.9% and 4.2% respectively, and helped mitigate the decline in voice revenue.
TM has proposed a final gross dividend of 13.1 sen on top of the interim gross dividend of 13 sen distributed last September.
Its earnings per share for FY10 was 33.9 sen.
http://biz.thestar.com.my/news/story.asp?file=/2011/2/26/business/8144845
By JEEVA ARULAMPALAM
jeeva@thestar.com.my
KUALA LUMPUR: Telekom Malaysia Bhd (TM) saw its fourth quarter ended Dec 31, 2010 net profit more than double to RM400.63mil from RM170.25 a year ago due to higher revenue and investment gains made by the disposal of shares.
TM booked a net gain of RM213.3mil from the sale of Measat Global Bhd and Axiata Group Bhd shares attributed to lapsed ESOS options.
The company also announced plans to carry out a capital distribution to its shareholders of some RM1.04bil, or 29 sen per RM1 each, in line with its capital management framework to return excess cash to shareholders.
While the business environment for its current financial year will remain challenging due to the intense competitive landscape, TM group chief executive officer Datuk Seri Zamzamzairani Mohd Isa says the company is set to take its stage of growth to the next level.
This would be on the back of its performance improvement programme, its focus on customer centricity and as it sought to achieve 1.1 million premises passed and a total of 78 exchange areas by the end of this year under its high-speed broadband project, UniFi, he told reporters at the company's result briefing yesterday.
The company's financial year ending Dec 31, 2011 (FY11) headline key performance indicators include a revenue growth of 2.5%, earnings before interest, tax, depreciation and amortisation margin of 32% and customer satisfaction measure of 70, which uses TRI*M index measuring end-to-end customer experience at all touch points. TM was able to meet all three headline KPIs for FY10.
For the quarter under review, revenue was up 2.11% to RM2.32bil from RM2.27bil from a year ago, due to higher revenue from data, Internet and multimedia and non-telecommunications-related services, which mitigated the impact of lower revenue from voice and other telecommunications-related services.
TM said data revenue increased by 14.4% to RM490.8mil in the quarter compared with RM428.9mil previously due to demand for higher bandwidth services.
Internet and multimedia posted higher revenue by 12.6% to RM436.6mil owing to an increase in broadband customers to 1.68 million in the quarter compared with 1.43 million a year ago.
Its earnings per share was 11.2 sen.
For its full year, TM's net profit was up 88% to RM1.21bil from RM643.03mil in FY09. Its revenue was up 2.1% to RM8.79bil driven by higher operating revenue from data services, Internet and multimedia and other telecommunications-related services, which grew by 15.4%, 5.9% and 4.2% respectively, and helped mitigate the decline in voice revenue.
TM has proposed a final gross dividend of 13.1 sen on top of the interim gross dividend of 13 sen distributed last September.
Its earnings per share for FY10 was 33.9 sen.
http://biz.thestar.com.my/news/story.asp?file=/2011/2/26/business/8144845
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