Dialog records Rs 6 bn Net Profit for FY 2012
Dialog Axiata PLC announcing its consolidated financial results for
the year ended 2012 including those of Dialog Axiata PLC (the “Company”)
and of the Dialog Axiata Group (the “Group”) post-consolidation with
subsidiaries Dialog Broadband Networks (Pvt) Ltd (“DBN”), and Dialog
Television (Pvt) Ltd (“DTV”), said the Group demonstrated a strong
revenue growth across Mobile, International, Digital Pay Television,
Tele-infrastructure and Fixed Line businesses to record consolidated
revenue of Rs 56.3 billion for FY 2012, translating to YoY growth of
24%. Group Revenue for Q4 2012 was recorded at Rs 15 billion, reflecting
growth of 4% QoQ.
Group EBITDA (earnings before interest, tax, depreciation and
amortisation) for the FY 2012 was recorded at Rs 18.6 billion, a
significant increase of 13% relative to the corresponding period in
2011. Group EBITDA Margin for FY 2012 declined marginally by 3
percentage points on a YoY basis to 33%. Group EBITDA contracted by 11%
QoQ due to escalation in marketing and promotion activities and one-off
costs related to modernisation of the company’s expansive service centre
network to deliver the very best in efficient customer care across all
provinces of the country.
Non-Operational performance below EBITDA for FY 2012 is characterised
by non-cash translational foreign exchange losses amounting to Rs 2.2
billion, and a one-off write back of the company’s deferred tax
provision of positive Rs 2.3billion.
Non-cash foreign exchange losses accrued due to the devaluation of
the SLR by 11.8% YTD and the write back of deferred tax was effected
subsequent to the company opting for 2% revenue tax with effect from
2013 following the expiry of the company’s tax holiday. Underpinned by
the positive EBITDA growth trajectory, Group NPAT recorded a strong
growth of 23% YoY to be recorded at Rs 6 billion in FY 2012.
Group NPAT for the 4th Quarter however exhibited an 80 % reduction
relative to the previous quarter due to the contraction of EBITDA due to
exceptional charges in the 4th Quarter, and an impairment charge of Rs
931 million related to legacy network elements being subject to
modernization and upgrade to match latest technology standards.
Group NPAT post normalisation for exceptional gains/charges
(consisting of the non-cash foreign exchange loss of Rs 2.2Bn, deferred
taxation reversal of Rs 2.3Bn and costs related to the Suntel
acquisition amounting to Rs 343Mn), is recorded at Rs 6.3Bn for the FY
2012 demonstrating a significant growth in normalized NPAT performance
of 29% YoY.
At an entity level, Dialog Axiata PLC (“the Company”) featuring the
Mobile, International and Tele-Infrastructure segments of the Group
portfolio continued to contribute a major share (87%) of Group Revenue
and (87%) of Group EBITDA. Company Revenue grew 4% QoQ to reach Rs
13.1Bn with revenue for FY 2012 being recorded at Rs 49.8Bn, up 19%
relative to FY 2011. During the course of 2012 the Company grew its
mobile subscriber base to 7.82Mn recording a 9% subscriber growth YoY.
On the backdrop of strong YoY performance in Revenue, Company EBITDA
for FY 2012 grew by 6% YoY to record at Rs 16.1Bn, featuring an EBITDA
margin of 32%. Notwithstanding aggressive revenue performance, Company
EBITDA contracted by 15% in the 4th Quarter relative to the previous
quarter due to the registering of one-off cost items and spend
escalations as detailed above within the analysis of Group performance
QoQ.
On the backdrop of strong YoY EBITDA performance, Company NPAT grew
by 6% YoY to be recorded at Rs 6.2Bn inclusive of the impact of the
deferred tax reversal of positive Rs 2.3Bn and non-cash forex
translational loss of negative Rs 2.2Bn. Company NPAT normalized for the
exceptional items was recorded at Rs 6.4Bn for FY 2012 an increase of
10% relative to FY 2011.
During the 4th Quarter, Dialog Axiata PLC made a decisive foray in to
the space of Digital Commerce through the acquisition of 26% in newly
formed company Digital Commerce Lanka (Pvt) Ltd which going forward
would bring together the e-commerce properties of market leading Daily
Deals site Anything.lk with those of the Dialog Group.
Dialog Television continued its growth momentum recording YoY revenue
growth of 27% to reach Rs 3.0Bn for FY 2012. DTV EBITDA was recorded at
Rs 636Mn for FY 2012, an improvement of 11% YoY on the back of strong
revenue growth. NPAT however decreased by 57% YoY to be recorded at Rs
11Mn for FY 2012 due to the recording of an exceptional impairment
charge arising from the ongoing upgrade of the company’s digital
satellite broadcasting network from MPEG2 to MPEG4 and High Definition
(HD) technologies. The transition to a full MPEG4 configuration will
enable DTV to increase the return on investment on Satellite Transponder
resources going forward in tandem with enhancing the quality of service
to consumers. DTV’s Pay Tv Subscriber base increased by 23% YoY to be
recorded at 264,000 as at the end of FY 2012.
The 4th Quarter saw the revolutionisation of the pay television
market in Sri Lanka with the introduction of Sri Lanka's first ever
Prepaid Television Service by Dialog TV. DTV’s prepaid service will
bring best in class Pay Television content within reach of a wide
spectrum of Sri Lankan households. The revolutionary Pay-As-You-Watch TV
service from Dialog enables subscribers to select channels genres or
individual channels and pay for them on a per-day basis.
Dialog Broadband Networks registered FY 2012 Revenues of Rs 5.0Bn (up
125% YoY) driven in the main by the acquisition, merger and operational
consolidation of Suntel Ltd. On the back of strong revenue and synergies
achieved through the amalgamation, YoY EBITDA improved very
significantly by 169% to be recorded at Rs 1.8Bn. Accordingly DBN
registered an 87% decrease in Net Loss YoY, with NPAT for FY 2012 being
recorded at negative Rs 120Mn relative to negative Rs 945Mn in FY 2011.
Dialog Broadband Networks secured the distinction of launching the
country’s first 4G LTE service for Home and Enterprise Customers in Q4
2012.
Group Capital expenditure for FY 2012 amounted to Rs 17.4Bn. Capital
expenditure was directed in the main towards High Speed Mobile Broadband
and Optical Fibre Network (OFN) expansion projects and towards providing
unparalleled data speeds and connectivity, further consolidating the
Company’s coverage and quality leadership position.
Group Free Cash Flow (FCF) was recorded at Rs 1.1Bn for the FY 2012
on the back of strong EBITDA performance and notwithstanding the
escalation of investments in High Speed Broadband Infrastructure and
growth capacity to cater for enhanced demand for the multiple ICT
services offered by the Dialog Group. The Group’s Net debt to EBITDA
increased marginally to 0.82x as at end of 2012 from 0.74x as at end of
2011.
In line with the performance of the Group and taking in to account
forward investment requirements to serve the nation’s demand for Mobile,
Fixed, Broadband and Digital Television services, the Board of Directors
of Dialog Axiata PLC, resolved to propose for consideration by the
Shareholders of the Company, a cash dividend to ordinary shareholders
amounting to thirty three cents (Rs 0.33) per share totaling to Rs 2.7Bn
demonstrating an increase of 32% in dividend per share compared to FY
2011.
The said dividend, if approved by shareholders would translate to a
payout of 45% of consolidated Group Profits after Preference Dividend
for the FY 2012.
The dividend so proposed will be considered for approval by the
shareholders at the Annual General Meeting (AGM) of the Company, the
date pertaining to which would be notified in due course. |