Maxis earnings hit by lower service revenue

PETALING JAYA: Maxis Bhd reported a net profit of RM397 million for the second quarter ended June 30, 2019, a 17% decline from RM478 million a year ago due to a 4.7% drop in service revenue to RM1.91 million from RM2.01 million a year ago.

Maxis said the lower service revenue was largely due to the termination of a network sharing agreement, decline in prepaid revenue generating subscriber (RGS) and an overall reduction in prepaid and postpaid average revenue per user (arpu), offset by growth in postpaid and home fibre subscribers.

“Postpaid service revenue for 2Q19 decreased by 3.7% in the second quarter to RM972 million compared to RM1.00 billion in 2Q18,” it said in a filing with Bursa Malaysia.

Meanwhile, its prepaid service revenue declined by 7.4% year-on-year to RM791 million from RM854 million on the back of a lower subscription base which was due to continued SIM consolidation, migration from prepaid to postpaid, and reduced Mobile Termination Rates (MTR).

Maxis also saw an additional 30,000 new fibre subscribers in 2Q19, bringing the total fibre subscriber base to 310,000.

During the quarter, it posted a revenue of RM2.20 billion against RM2.24 billion recorded a year ago, reflecting a 1.8% decrease.

For the first half of the year, the group recorded a net profit of RM806 million, a 19.5% decline from RM1 billion recorded in the corresponding period of the previous year while revenue for the period fell 1% to RM4.43 billion from RM4.48 billion a year ago.

Maxis declared a first interim dividend of 5 sen per share, to be paid on Sept 26, 2019. The entitlement date has been set on Aug 30, 2019.

Maxis CEO Gökhan Ogut (pix) said that the group is making headway in its converged ambitions with the launch of new fibre speeds, delivering smart solutions for enterprises and championing Industry 4.0 initiatives in line with the government’s digital economy agenda.

“The potential of 5G in a future of smart solutions is tremendous. To this end, our 5G live trials are progressing well,” he said.

source https://www.thesundaily.my/business/maxis-earnings-hit-by-lower-service-revenue-ND1207807