Maxis 2Q earnings lower at RM343m

by FARA AISYAH/ pic by MUHD AMIN NAHARUL

MAXIS Bhd’s net profit in the second quarter ended June 30, 2020 (2Q20), declined 13.6% to RM343 million from RM397 million recorded last year, mainly due to loss of wholesale business and higher impairment made to receivables amid the pandemic.

This came as the group revised the expected loss rates used to derive the impairment of trade receivables, based on higher credit risk because of the Covid-19 pandemic and its global economic impact.

The telecommunications company’s (telco) quarterly revenue fell 2.7% to RM2.15 billion in 2Q20 from RM2.21 billion last year.

Service revenue was 0.9% lower at RM1.9 billion in 2Q20 versus RM1.92 billion achieved a year earlier, due to the loss in prepaid and loss of wholesale revenue.

Normalised Ebitda slid 4.6% to RM903 million from RM947 million last year.

“The Movement Control Order (MCO) has seen Maxis experiencing higher pressure on prepaid and roaming revenues, lower sales in stores and businesses from the more challenged sectors, but also with increased demand for services, particularly around connectivity, converged solutions and digital care,” the telco told Bursa Malaysia yesterday.

It declared a second interim dividend of four sen to be paid on Sept 24, 2020. Postpaid service revenue increased slightly to RM974 million in 2Q20 from RM972 million in 2Q19. Postpaid revenue-generating subscribers expanded 9.7% to 3.4 million subscribers from 3.1 million a year ago.

However, postpaid average revenue per user (ARPU) decreased 6.6% to RM85 per month in 2Q20 from RM91 in 2Q19, reflecting mobile termination rate reduction, reduced international outbound roaming, and the dilution effect from HotLink Postpaid and Maxis Postpaid Share Line.

Prepaid service revenue contracted 13.3% to RM686 million from RM791 million last year, as the MCO “put a constraint on physical retail channels and field sales team in April and May”.

Prepaid subscription base fell by 6.9% or 442,000 subscribers, due to continued SIM consolidation and successful migration to entry point postpaid.

Prepaid ARPU was at RM40 per month in 2Q20 compared to RM41 in 2Q19. Blended ARPU was unchanged year-on-year at RM57.

As at end-June 2020, Maxis had 9.478 million revenue-generating subscribers, down 1.6% from 9.63 million last year.

The telco added 101,000 subscriptions to its fibre broadband segment during the quarter, while blended home fibre ARPU rose to RM108 from RM106 previously.

Home fibre connections jumped 32.6% to 366,000 as at end-2Q20 from 276,000 last year, while business fibre connections climbed 32.4% to 45,000 from 34,000.

Maxis also said demand for data grew exponentially, as customers consumed an average of 21.1GB data monthly in 2Q20, 54% higher than last year.

The telco is “accelerating” its 5G network readiness, CEO Gökhan Ogut (picture) said, adding that it’s “ready to deploy 5G and committed to providing the best 5G innovation to Malaysia as soon as the spectrum is made available”.