Tuesday, May 4, 2010

DiGi Sees Flat Quarterly Profits on Higher Revenues

Malaysia's DiGi.Com has reported a 6% rise in its first-quarter revenues of RM1.3 billion (US$404 million) along with a slight rise in net profits to RM278 million (US$86.5 million) from RM275 million a year ago. The Group's subscriber base is currently at 7.9 million customers, a year-on-year increase of almost 10%. ARPU was somewhat lower at RM53 (US$16.48) compared to RM56 recorded in the same quarter last year, primarily because of lower end-user prices driven by a very competitive market place.

Chief Executive Officer Johan Dennelind said: "I am pleased that we have been able to generate a very good set of numbers this quarter, thanks to encouraging subscriber acquisition in our prepaid segments, higher usage of mobile internet services and growing brand strength across segments all driven by our passionate employees."

For the quarter ended 31 March 2010, earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 6% to RM576 million, while margin strengthened to 44.6%.

On the Group's outlook for 2010, DiGi's growth is targeted to maintain the year-on-year growth pace and end up above industry growth. This is supported by continued growth in key areas, especially in mobile internet for big and small screens, but also through continued market share gain.

The margins will continue to be under pressure from higher handset subsidies, lower prices in key segments and from mobile internet expansion costs. This will, to a high degree, be compensated by cost optimisation programmes across the Company that continue to deliver significant savings.

"The future looks bright for DiGi, and we will continue to invest in delivering excellent customer experience through our brand and touch points for our customers, sustaining profitable growth in key segments and around mobile internet. We will also step up operational efficiency through further cost and asset optimisation. In short, we are confident that we can maintain a healthy financial structure to support the growth of the business in efforts to continue delivering superior returns to our shareholders," said Dennelind, who concluded by commenting on his departure.

"Of course, it is sad to leave friends and colleagues, but it feels good that the Company stands stronger than ever and when the momentum is still building. I wish Henrik Clausen, the new CEO, and my fellow DiGizens all the best in the quarters and years to come."

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