The latest Second Quarter 2019 (2Q19) financial results from Digi shows that it now has 11.36 million mobile subscribers in Malaysia. The Telco added 113k new mobile subscribers between April, May and June, up from 11.25 million it had as of March 2019.
About 2.07 million customers (18.2%) don’t use Digi Internet. Digi reported 9.3 million (81.8%) active mobile Internet subscribers as of June 2019 compared to 9 million at the end of March 2019.
Out of 9.3 million Digi Internet users, some 800k are using Internet on 2G/3G as they don’t have access to the Digi 4G LTE network likely due to poor mobile coverage or lack of a 4G LTE enabled smartphone/devices. Digi has 8.5 million mobile subscribers active on its 4G LTE network.
Digi 4G LTE coverage now stands at 90% as of June 2019 (vs 89% as of March 2019). About 70% of the 4G LTE network are LTE-Advanced (CA) enabled, supposedly for super fast speeds.
In 2Q19, Digi mobile subscribers consumed an average 11.4GB a month compared to 10.2GB in 1Q19.
83.1% of Digi mobile subscribers are smartphone users. Digi sold 102k devices between April, May and June 2019.
MyDigi app active user base grew to 3.3 million with 16.1 million upsell transactions on the mobile app.
Digi Prepaid Mobile Subscribers as of 2Q19 (June 2019):
- 8.44 million Digi Prepaid Subscribers (8.4 million in 1Q19)
- Added 42k prepaid subscribers
- 6.7 million using mobile Internet (79.1% of the prepaid base)
- 1.74 million prepaid subscribers don’t use Digi Internet (20.9% of the prepaid base)
- ARPU at RM29, unchanged
Postpaid Mobile Subscribers as of 2Q19 (June 2019):
- 2.93 million Digi Postpaid Subscribers (2.86 million in 1Q19)
- Added 71k postpaid subscribers
- 2.6 million using Digi Mobile Internet (89.6% of the postpaid base)
- 330k postpaid subscribers don’t use Digi Internet (10.4% of the postpaid base)
- ARPU at RM70 (vs RM71 in 1Q19)
Digi 2Q 2019 Financials:
| RM million | 2Q18 | 1Q19 | 2Q191 | Q-o-Q | Y-o-Y | 1H18 | 1H19 | 1H-o-1H |
| Total revenue | 1,618 | 1,509 | 1,549 | 2.7% | -4.3% | 3,253 | 3,058 | -6.0% |
| Service revenue2 | 1,484 | 1,441 | 1,451 | 0.7% | -2.2% | 2,967 | 2,892 | -2.5% |
| EBITDA | 768 | 723 | 752 | 4.0% | -2.1% | 1,543 | 1,475 | -4.4% |
| EBITDA margin | 47% | 48% | 49% | 0.6pp | 1.1pp | 47% | 48% | 0.8pp |
| PAT | 384 | 366 | 414 | 13.1% | 7.8% | 770 | 780 | 1.3% |
Key Financial Highlights (Y-o-Y), according to Digi:
- Service revenue grew 0.7% q-o-q with a narrowed decline of 2.2% y-o-y to RM1,451 million,
primarily driven by solid 12.6% postpaid revenue and 9.2% internet revenue growth y-o-y - Prepaid revenue trimmed 13.2% y-o-y to RM751 million; ongoing shift in voice (46%) to internet (54%) revenue mix narrowed y-o-y decline to drive more sustainable returns moving forward
- OPEX was flat y-o-y and remained a healthy 34.7% in proportion to service revenue, while investments into network and service innovation continued to ensure solid customer experience in the quarter
- EBITDA rose to RM752 million or 49% margin
- Profit After Tax1 (PAT) steady at RM414 million at 27% margin, after accounting for prior years’ deferred tax overprovision of RM16 million
- Ops cash flow dipped 20.9% y-o-y to RM491 million or 32% margin due to accelerated capex investment for network expansion
- Net debt to EBITDA ratio healthy at 0.8 times while conventional debt over total assets steady at 21%, well within the Shariah threshold based on pre-MFRS 16
- Declared second interim dividend per share of 5.0 sen or RM389 million, payable to shareholders on 27 September 2019
Digi CEO Albern Murty said, “We aim to deepen our customer insights capabilities and digitalisation efforts to drive differentiated customer experiences, connecting more Malaysians with services that matter most to them. We have started executing on this strategy and remain resilient in the midst of challenging market conditions.”
