Dialog Group posts consolidated revenue of 26.6b in 2Q

Dialog Axiata Group, which includes its Mobile, Fixed Line, Digital Pay Television and Tele-infrastructure businesses, has recorded consolidated revenue of Rs. 52.7 billion for the six months ended 30th June 2018 (1H), demonstrating a growth of 17% Year-to-Date (YTD), while revenue growth moderated to 2% Quarter-on-Quarter (QoQ) to be recorded at Rs. 26.6 billion for Q2 2018.

The Group Net Profit After Tax (NPAT) demonstrated a growth of 46% YTD to record Rs. 5.7 billion for 1H 2018 underpinned by strong Group Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) performance. Q2 2018 NPAT remained at Q1 2018 level of Rs 2.8 billion, as EBITDA improvement was negated by the increase in depreciation and taxes.

Group EBITDA grew 32% YTD and 4% QoQ to reach Rs 20.3 billion for 1H 2018 and Rs 10.4 billion for Q2 2018 respectively. The Groups stated that growth was supported by resilient core revenue growth coupled with efficient cost management and operational efficiencies. The adoption of SLFRS 15 ‘Revenue from Contracts with Customers’ with effect from 1st January 2018 resulted in an EBITDA upliftment of Rs 1 billion for 1H 2018 which is a 1.6pp increase in EBITDA margin. Normalised for the positive impact from SLFRS 15, the EBITDA margin was recorded at 36.9% for 1H 2018. The impact on revenue from the adoption of the standard was not material.

At an entity level, the mobile subsidiary Dialog Axiata PLC continued to contribute a major share of Group Revenue (80%) and Group EBITDA (78%). On the back of its Mobile customer base of over 13.2 million subscribers, Company Revenue grew by 12% YTD to reach Rs 41.9 billion for 1H 2018 with revenue for Q2 2018 being recorded at Rs 21.3 billion, up 3% QoQ.

Underpinned by strong revenue growth and cost initiatives, Company EBITDA was recorded at Rs. 15.8Bn for 1H 2018 and Rs. 8.2 billion for Q2 2018 respectively, representing an increase of 30% YTD and 7% QoQ. The Company NPAT demonstrated a growth of 26% YTD to be recorded at Rs5.2 billion for 1H 2018, driven by strong EBITDA growth. On a QoQ basis, NPAT grew by 7% to record Rs 2.7 billion for Q2 2018.

Dialog Television (“DTV”), recorded a subscriber growth of 13% YoY by end Q2 2018. Post normalization for SLFRS 15 impact, DTV Revenue grew by 5% YTD to be recorded at Rs 3.2 billion for 1H 2018. Normalised DTV EBITDA grew 129% YTD to reach Rs. 400 million for 1H 2018 as a result of strong revenue growth and cost management. Accordingly, DTV Net Loss declined to Rs 245 million in 1H 2018 relative to a Net Loss of Rs 528 million for the corresponding period in 2017.

Dialog Broadband Networks (“DBN”), featuring the Group’s Fixed Telecommunications and Broadband Business, recorded revenue of Rs 7.2 billion for 1H 2018 increasing 21% YTD. Downstream of strong revenue performance, DBN EBITDA recorded a growth of 35% YTD to record Rs 4.2 billion for 1H 2018. In line with performance dynamics at EBITDA level, DBN NPAT grew 78% YTD to record at Rs1Bn for 1H 2018.

Dialog Group contributed a total of Rs 17.8 billion to state revenues during the first six months of 2018. Total remittances included Direct Taxes and Levies amounting to Rs 4.9 billion and Rs. 12.9 billion in Consumption Taxes.