Digi has 10.68 million Mobile Subscribers, 1.9 million non-Internet [3Q20]

Digi.com Berhad (Digi) reported its third quarter 2020 (3Q20) financial results today. The Malaysia-based wireless carrier has 10.68 million mobile subscribers, up from 10.62 million in 2Q20. Digi added 57,000 (57k) new mobile subscriptions between July, August and September 2020.

Breakdown and details of Digi Mobile subscribers in 3Q20 as below:

• 7.66 million prepaid subscribers, added 67,000 new subscriptions (vs 7.59 million in 2Q20)
• 3.02 million postpaid subscribers, lost 10,000 subscriptions (vs 3.03 million in 2Q20)
• 8.78 million are Internet subscribers including 6.07 million on prepaid and 2.71 million on postpaid. Added 71,000 Internet subscribers
• Average monthly Internet usage per customer was 17.4GB down 3% from 18GB in 2Q20
• 1.59 million prepaid and 313,000 postpaid customers don’t use Digi mobile Internet (total 1.9 million)
• ARPU: Prepaid at RM33 (+RM4), Postpaid at RM67 (-RM1)

Digi did not reveal the number of its fibre broadband customers.

Commenting on its postpaid subscriber base, Digi said its “postpaid base sustained its Q-Q momentum, or 1.0% Y-Y growth to 3.0 million despite being challenged by involuntary churns and plan downgrades due to softer affordability. Postpaid ARPU trimmed marginally to RM67 on the back of lower roaming and interconnect ARPU.”

In Q3 2020, the Telecommunication company invested RM134 million in capex for network enhancements. “Our dedicated network front liners worked tirelessly to efficiently deploy new and upgraded sites and boost network optimisation activities,” An additional 44% new and upgraded sites were deployed in the first 9 months of 2020 versus a year ago. Digi’s 4G LTE and LTE-A network now covers 91% and 74% of the population respectively, together with a fibre network that stretches 9,850km.

“Our commitment to maintain consistent user experiences reflected in our steady performance as #1 on network consistency and download throughput with minimal quality degradation as measured by third party data,” it said.

Key Financial Highlights, according to Digi:

• Total revenue grew 8.7% q-o-q and 1.1% y-o-y to RM1,579 million on a wider range of innovative core product launches and digital solutions curated to suit customers’ connectivity needs.
• Uplift in prepaid revenue substantially cushioned y-o-y service revenue decline, narrowing it to -2.8% despite lower regulated interconnect rates, and weaker roaming and consumer spend due to Covid-19.
• Internet and digital revenue rose 9.8% y-o-y to RM1,004 million, represented 73.1% of service revenue against 64.6% a year ago.
• Postpaid revenue stood at RM626 million.
• Prepaid subscriber base grew, contributing to a 7% increase in Prepaid revenue for the quarter.
• Profit After Tax (PAT) was RM321 million or 20.3% margin.
• OPEX stood at RM397 million, having invested in advertising and promotional activities as sales efforts recovered post-MCO.
• Ops cash flow at RM652 million or 41.3% margin having invested RM134 million capex for network enhancements.
• Net debt to EBITDA ratio remained healthy at 1.5 times while conventional debt over total assets of 7.5% was well-within the Shariah threshold.
• Third interim dividend of 4.1 sen per share equivalent to RM319 million, payable to shareholders on 17 December 2020.

Digi’s CEO Albern Murty said, “Digi navigated well through a difficult time to deliver a better quarter, driven by our resilience to improve business opportunities as we supported our customers. to emerge stronger from the crisis. In the quarter, we expanded our range of innovative and value-driven offerings across our core product portfolios, launched fibre broadband nationwide to serve more households with total connectivity, and modernised our distribution and network capabilities. Going forward, we remain focused on financial resilience by prioritising investments in strategic areas to enable greater affordability for customers, and drive growth for the business.”