Astro posts lower net profit in 2Q

by ANIS HAZIM / pic by BLOOMBERG

ASTRO Malaysia Holdings Bhd posted a lower net profit of RM87.13 million in its second quarter ended July 31, 2021 (2Q21) compared to RM133.65 million in 2Q20.

While revenue for the current quarter dropped 2.18% to RM1.06 billion against RM1.09 billion in the previous year from a decrease in subscription revenue and merchandise sales, offset by an increase in advertising revenue and sales of programming rights.

TV revenue for the current quarter of RM922.2 million was slightly lower by RM3 million or 0.3% against corresponding quarter of RM919.2 million, mainly arising from a decrease in subscription revenue, offset by an increase in sales of programming rights and advertising revenue.

Revenue continues to be impacted by Covid-19 pandemic, Astro noted.

“TV’s Ebitda decreased by RM63.8 million or 17.8% against the corresponding quarter.

This is due to higher content costs and impairment of receivables, offset by lower license, copyright and royalty fees and telecommunication expenses,” said Astro.

It added that radio’s revenue for the current quarter of RM32.7 million has improved by RM5.6 million or 20.7% compared to the corresponding quarter of RM27.1 million with higher Ebitda contributed by the revenue growth, continuous cost reduction measures taken by management and lower license, copyright and royalty fees.

Home-shopping’s revenue for the current quarter reduced to RM105.3 million compared to the corresponding quarter of RM144.7 million, primarily due to negative consumers’ sentiments, resulting in lower spending.

“In addition, the implementation of Full Movement Control Order during the quarter affected the production, inventory level and supply chain as well as delivery to customers in places with a high number of Covid cases,” said Astro.

On its outlook, Astro CEO Henry Tan said the group is actively revitalising its brand in its transformation journey.

“Our ambition to be Malaysia’s No 1 aggregator of the best streaming services, enhancing local content by producing more premium Astro originals, seizing opportunities for adjacencies in commerce, broadband and digital, and realisation of our reimagined business models and technology with the evolving ecosystem,” Henry said.

He said the prolonged pandemic will have consequential effects on Astro’s revenue, particularly in the areas of advertising, enterprise and residential subscription revenues.

“However, the rollout of the nationwide vaccination programme and subsequent relaxation of restrictions are paving the way for economic recovery,” he noted.

Given these uncertainties, the group will continue to monitor and assess business conditions, while prudently managing costs to ensure sustainable operations and business performance.

Astro’s share price fell 0.94% or one sen to RM1.05 at close yesterday, valuing the group at RM5.48 billion.