Maxis Q3 profit dips 9% on higher operation, maintenance costs

PETALING JAYA: Maxis Bhd’s net profit fell 9% to RM513 million for the third quarter ended September 30, 2018 compared with RM564 million in the same quarter last year, mainly dragged by higher operation and maintenance costs.

Its revenue also declined 3% to RM2.26 billion from RM2.33 billion.

Maxis has proposed to declare an interim dividend of 5 sen per share for the quarter under review.

The telco told Bursa Malaysia that its service revenue dipped 3% to RM2.03 billion due to the decline in prepaid, which offset the growth in postpaid and home fibre segments.

Postpaid revenue grew 2.8% to RM1.03 billion, underpinned by continued subscription growth with stable and high average revenue per user (ARPU) of RM93.

However, prepaid revenue was 10.1% lower at RM851 million, reflecting intense on-going price competition in the market.

“Additionally, the prepaid segment was also impacted by SIM consolidation and migration to postpaid. Well executed marketing initiatives have helped us narrow the decline in the customer base and maintain a stable ARPU at RM42.”

The group’s earnings before interest,taxes, depreciation and amortisation (ebitda) margin on service revenue remained high at 51.7% on the back of cost optimisation initiatives.

For the quarter under review, Maxis spent RM195 million in capital expenditure (capex) for network maintenance and capacity expansion and it expects to accelerate the investment in the coming quarter.

Maxis CEO Robert Nasion said the group anticipates strong headwinds emerging with the tapering of wholesale revenue, the impact of Sales and Services Tax, investment in new fibre offerings and continued intense price-focused competition.

The group’s nine-month net profit was down 7.6% to RM1.51 billion from RM1.64 billion, with revenue skidding 4.2% to RM6.75 billion from RM7.04 billion.

At the midday break, Maxis’ share price dropped 6 sen or 1.1% to RM5.44 on 314,800 shares traded.

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