PETALING JAYA: Telekom Malaysia Bhd (TM) reported a net loss of RM51.09 million for its fourth quarter ended Dec 31, 2019 from a net profit of RM69.66 million registered in the corresponding period of the previous year due a drop in revenue and a one-off RM233.7 million fair value adjustment on medium term notes issued by a non-controlling interest of a subsidiary.
Revenue for the quarter stood at RM3.03 billion, a 1.8% decline from RM3.09 million reported previously.
Its Unifi business contributed a loss before interest and tax (LBIT) of RM21 million for 4Q19 compared to an earnings before interest and tax (ebit) of RM71.5 million reported in 4Q18 attributed to a lower revenue from voice and Internet and multimedia services, its year end promotion and the impact from the Streamyx price adjustment.
Its TM ONE segment saw ebit declined by 25.3% to RM195.6 million from RM261.7 million recorded previously.
Meanwhile, the group’s TM Global business saw its LBIT shrank by 83.4% to RM40.4 million from RM244 million reported previously.
For the full financial year, the group posted a net profit of RM632.68 million, a 4.13 times improvement over RM153.15 million reported in the previous financial year attributed to lower impairment losses and continued operating cost reduction.
Meanwhile, revenue for the period declined by 3.3% to RM11.43 billion from RM11.82 billion reported previously, mainly due to lower contribution from all lines of products except data.
For the period, TM has declared a final interim cash dividend of 10 sen per share for the financial year ended Dec 31, 2019, which will be paid on April 3, 2020.
TM group CEO Datuk Noor Kamarul Anuar Nuruddin said the group’s performance improvement initiatives continued to bear fruit, especially on cost. He pointed out that its cost optimisation effort saw a 13.1 percentage point improvement in terms of total cost to revenue in the previous year.
“This has delivered better profitability with recorded ebit growth of more than 100.0% at RM1.57 billion, from ebit of RM64.6 million over the corresponding period last year. This is the highest ebit recorded since 2007,” said Kamarul.
He added that 2019 has been a transformative period for the group as it continue to adjust to new market dynamics and declining revenue from traditional revenue while simultaneously prepare for 5G.
“Against this backdrop, we have seen continued improvements in our fundamentals despite the revenue challenges on the retail front,” he said in a statement.
Moving forward, Kamarul explained that TM is positioning itself as the National Telecommunications Infrastructure Provider for 5G and the primary enabler to the National Fiberisation and Connectivity Plan towards accelerating the deployment of 5G and making way for an era of shared 5G networks.
“This is where in our opinion, co-building and co-sharing infrastructure with other telco players, as well as collaborating with emerging industry players for digital solutions is the best way to move forward,” he said, adding that strong partnerships will generate significant capital and operating expenditure savings, extend coverage at lower costs, achieve faster 5G rollout, and optimise resource utilisation.
“In 2020, we are going back to basics in strengthening our foundation, which includes improving network and IT; enhancing processes and market distribution; moving beyond connectivity services into new value-added digital services and expanding sales generation.”
Towards this end, it will focus on four strategic pillars – customer excellence, revenue generation, manpower optimisation with workforce remobilisation and superior network through modernisation, to remain stable in the course for long term growth.
source https://www.thesundaily.my/business/tm-posts-rm511m-net-loss-in-q4-on-one-off-fair-value-adjustment-CB2030163
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