Telekom Malaysia Berhad (TM), Malaysia’s self claimed “Convergence Champion” reported its First Quarter 2019 (1Q19) financial results last Thursday.
There are now 2.2 million fixed broadband subscribers as of March 2019, down from 2.24 million it had as of December 2018.
According to Telekom Malaysia (TM), “unifi customer base continues to grow, whilst drop in Streamyx was partly due to migration of customers to unifi”.
However, not all Streamyx broadband customers migrated to Unfi fibre broadband. TM added just 25k new Unifi customers in the quarter but this was not able to compensate some 64k Streamyx customers it lost during the same period.
As of March 2019, Telekom Malaysia (TM) has 1.32 million Unifi customers (+25k vs 1.3 million in 4Q18) and some 872,000 Streamyx customers (-64k vs 936 million in 4Q18). About a year ago, TM had 1.13 million Streamyx subscribers.
There’s also a drop in APRU: Unifi at RM179 (-RM5 vs RM184 in 4Q18), Streamyx at RM87 (-RM1 vs RM88 in 4Q18).
TM did not disclose the number of its Unifi Mobile customers.
The broadband company said, as of 1Q19:
- 973,000 unifi customers upgraded to 10 times existing speed
- 266,000 Streamyx customers in unifi coverage areas upgraded to unifi
- 226,000 Streamyx customers in non-unifi coverage areas upgraded to 2 times existing speed where technology permits
The company did not disclose the fate of some 500k Streamyx customers who won’t be enjoying any speed upgrade or if they will be able to migrate to Unifi. These Streamyx broadband customers will continue to pay a minimum RM110/month for just 1Mbps speed while Unifi customers will continue to enjoy Internet speeds from 30Mbps, as low as RM79/month.
Financial and Operational Highlights 1Q 2019, according to TM:
- Group Revenue of RM2.78 billion, 2.4% lower year-on-year (YoY) due to a decline in voice, Internet and multimedia services and non-telecommunication related services revenue.
- Group Reported Earnings Before Interest and Tax (EBIT) at RM504.8 million, doubled YoY from RM195.6 million in 1Q 2018, mainly due to reduction in operating costs. Stripping off some non-operational items, such as unrealised foreign exchange loss on international trade settlement, Group Normalised EBIT also more than doubled to RM513.0 million from RM206.6 million last year.
- Group Reported Profit After Tax and Non-controlling Interests (PATAMI) jumped 96.2% YoY from RM157.1 million in 1Q 2018 to RM308.3 million, whilst Group Normalised PATAMI more than doubled to RM296.4 million.
- The total capital expenditure (CAPEX) for 1Q 2019 was in line with guidance at RM151.0 million, or 5.4% of revenue. By asset type, access comprised 67.0% of total spending, followed by core network at 18.0% and 15.0% for support systems.
Imri Mokhtar, the Acting Group Chief Executive Officer / Chief Operating Officer of TM commented:
“As expected, revenue challenges continued to persist into the first quarter of the year, with intensifying competition and price erosion. However, I’m pleased to report that our Performance Improvement Programme 2019-2021 (PIP2019-2021) is yielding results. We recorded improved operational efficiency and increased profitability. Our operating Expenditure (Opex)/Revenue also improved by 11.4 percentage points, whilst profit for the quarter also doubled mainly from the cost optimisation efforts undertaken to counter revenue decline. Our CAPEX spending was lower compared to 1Q2018 and within our guidance, as we continued to sweat our assets and optimise our network.
We expect the industry and competitive landscape to continuously evolve. We remain focused on delivering our strategies of accelerating convergence and empowering digital to enable a Digital Malaysia; whilst we strengthen our resilience with our PIP initiatives and improve on customer experience.”