Axiata swings to net loss in 1Q18 on Idea losses

23 May 2018

Malaysia-based telecoms group Axiata has published its financial results for the first quarter of 2018, claiming a ‘healthy underlying performance’ for the period under review. In the three months ended 31 March 2018 Axiata recorded revenues of MYR5.7 billion (USD1.4 billion), down 2.3% year-on-year from MYR5.9 billion in 1Q17, which it attributed to foreign exchange movement, as the Malaysian riggit strengthened against the currencies for all of the group’s operating units. Meanwhile, EBITDA for the Group was down by 5.5% in 1Q18 at MYR2.0 billion on the back of the reduced turnover, while a net loss of MYR94.4 million in the quarter under review, compared to a net profit of MYR262.0 million in 1Q17. Axiata noted that its bottom line had been impacted by the ‘share of business losses from Indian operator Idea Cellular of MYR124.3 million against losses of MYR25.4 million in 2017 as the [provider] continued to struggle with the devastating price war and a hyper competitive market’. Excluding the impact of Idea, Axiata said profit after tax (PAT) would have been up by 34.6% y-o-y at MYR386.9 million.

Axiata was also keen to note that at constant currency terms, and when excluding the newly introduced Malaysian Financial Reporting Standard (MFRS), group revenue had actually improved by 5.2% y-o-y to MYR6.2 billion, with ‘increased revenue market share in most Operating Company markets’. Similarly, at constant currency EBITDA was also up by 4.3% y-o-y to MYR2.2 billion, with the group attributing this in part to its continued cost optimisation programme.

Commenting on the company’s quarterly performance, Axiata Chairman Tan Sri Datuk Wira Azman Hj Mokhtar said: ‘Despite it being a tough start to the year with intense competition particularly in India and Indonesia, I am pleased to see that Axiata’s underlying business performance remained on track and in line with target. We will continue to focus on long term objectives and strengthen our fundamentals to ensure a stronger performance for 2018.’

Malaysia, Axiata, Vodafone Idea (previously Idea Cellular)