Axiata swings to net loss in 1H22 on unrealised forex losses

26 Aug 2022

Malaysia-based Axiata has published its financial results for the first half of 2022, saying it saw a ‘pickup’ of revenue across its markets as COVID-19 restrictions eased. Total turnover for the opening six months of 2022 stood at MYR13.174 billion (USD2.94 billion), up from MYR12.454 billion in H1 2021, while revenues in the second quarter of 2022 totalled MYR6.704 billion (2Q21: MYR6.390 billion). Further, revenue excluding from equipment sales was MYR12.794 billion in 1H22, up from MYR12.061 billion a year earlier, with Axiata noting that all operating companies bar Ncell had contributed to growth; the Nepalese operator recorded lower voice and ILD revenues.

In terms of other key financial indicators, meanwhile, Axiata reported EBITDA of MYR5.909 billion for 1H22, up from MYR5.503 in the corresponding period of 2021, with second quarter EBITDA standing at MYR3.011 billion (2Q21: MYR2.811 billion). However, the company saw its bottom line impacted by unrealised foreign exchange losses coupled with higher taxes and net finance cost; as such Axiata swung to a net loss of MYR149 million in 1H22, compared to a net profit of MYR353 million in the first half of 2021.

On the back of its first half financial performance, Axiata said it was now likely to exceed its previously announced guidance for revenue and EBIT growth, which it had forecast will be in the mid-single digit and high single digit ranges, respectively.

Commenting on the company’s first half, Vivek Sood, Joint Acting CEO of Axiata said: ‘With COVID-19 impacts clearly behind us, a majority of our operating companies have delivered solid operational results in the first half of 2022, mostly outperforming in their markets. With the improved operational performance, we are likely to exceed the headline KPIs for the year both in terms of revenue excluding device as well as EBIT growth … Forex impact and macro headwinds especially in Sri Lanka, Bangladesh and Nepal had adversely impacted group earnings. To stem the tide, our immediate focus will be directed towards integrating new acquisitions, managing USD liquidity and inflation especially in frontier markets and easing out the balance sheet stretch.’

Malaysia, Axiata