KDDI establishes USD1.8bn war chest for Southeast Asia push; full year revenue up 6.2%

10 May 2018

The Nikkei Daily writes that Japanese carrier KDDI Corp is willing to spend up to JPY200 billion (USD1.82 billion) in the current fiscal year to expand its presence in Southeast Asia and develop its portfolio of services in its home market, with Philippines and Vietnam cited as potential targets. The region is considered an extremely promising market by Japan’s second largest carrier, with KDDI President, Makoto Takahashi, confirming: ‘It would be good if we can find a company [to partner with] in such places as the Philippines or Vietnam or elsewhere in Southeast Asia’. The firm’s investment budget marks a 30% increase on the average sum committed in the past two years, and although Takahashi stopped short of providing a breakdown of the spending proposal, the Philippines represents a possible option as the country’s president Rodrigo Duterte is forcing through plans to license a third carrier to take on the de facto duopoly of PLDT and Globe Telecom. KDDI Corp is already developing telecom services in Mongolia and Myanmar in collaboration with Japanese trader Sumitomo and local partners.

Separately, KDDI today (10 May) published its financial results for the year ending 31 March 2018, highlighting that operating revenue increased 6.2% year-on-year to JPY5.042 trillion from JPY4.783 trillion, operating income improved by 5.5% to JPY962.8 billion, EBITDA edged up 2.4% y-o-y to JPY1.560 trillion – with an EBITDA margin of 30.9% (down 1.2pp) – and net income rose by 4.7% to JPY572.5 billion from JPY546.7 billion in FY2016/17. The company noted that its strong performance was driven in the main by ‘the revenue increase of mobile communications revenues, value-added APRA revenues, profit increase of the Business Services segment and Global Services segment’.

The carrier, which markets mobile services under the ‘au’ branding, closed out 31 March 2018 with a total of 52.283 mobile subscribers, compared to 48.540 million one year earlier. It also reported having 1.778 million MVNO connections on its books – and targets 2.650 million by end-March 2019 – and 29.334 million WiMAX customers for its UQ Communications unit. Further, KDDI said it had 4.377 million fibre-to-the-home (FTTH) subscribers at the end of the year, up from 4.139 million in FY2016/17.

Japan, KDDI (au)