Harimau Capital

KUALA LUMPUR: Maxis Bhd’s fourth quarter net profit jumped 47.5 per cent to RM900 million from RM610 million in the corresponding period in 2010, largely due to a last mile broadband tax incentive for the previous years and current year.
Profit for the final quarter ended December 31 2011 was also helped by lower net finance costs arising from reversal of provision for site rectification and decommissioning works.

Revenue fell marginally to RM2.26 billion from RM2.31 billion in the previous corresponding period.

Maxis expects the operating environment for 2012 to remain competitive and challenging. The fourth quarter results pushed Maxis’ full-year net profit to over RM2.52 billion or 10.10 per cent more than the year before.

“A continuing focus on operational efficiency saw Maxis delivering its customary industry-leading earnings before interest, tax, depreciation and amortisation (Ebitda) margin at 50.3 per cent, putting it among the best performing telcos globally,” the company said in a press release.

Ebitda grew by 0.2 per cent to RM4.42 billion from RM4.41 billion in 2010. Revenu e for the full year was RM8.80 billion versus RM8.86 billion previously despite having scaled down the low margin hubbing business which is a part of its International Gateway (IGW) services.

Overall, Maxis results were within analysts’ estimates, according to Bloomberg data. Maxis also declared a fourth interim singletier tax exempt dividend of 8 sen per share and is proposing a final single-tier tax exempt dividend of 8 sen per for 2011.

This brings the total dividend to RM3 billion or 40 sen per ordinary share for last year. As at end-2011, Maxis has the industry’s largest subscription base at 14 million.

Revenue was mainly driven by mobile Internet usage, content subscription and stronger wireless broadband revenue from a higher subscription base.

For its outlook for 2012, chief executive officer Sandip Das said Maxis will focus quite substantially on growing its revenue that it hopes would result in a stronger Ebitda.

"More importantly, we want to see new revenue streams coming in this year. We are very excited about turning in a stronger financial performance this year," he said at a media briefing on the company's results.

Revenue growth, he said, is expected to come from the rising demand for data from wireless broadband, Internet access and other non-voice services on the back of lower voice segment growth.

Last year, the non-voice segment grew an impressive 17 per cent and made up 43.5 per cent of Maxis' total mobile services revenue.

Sandip said the company is strengthening grip on future revenues, justifying its continued investment in the past two to three years in data infrastructure and partnerships.

He said Maxis is expecting the government to grant the 4G LTE (fourth generation long-term evolution) technology very soon, adding that the company could spend close to RM1 billion over the next two to three years on the 4G LTE alone if it takes off.