Axiata remains bullish

Group confident of exceeding financial targets

KUALA LUMPUR: Axiata Group Bhd is looking at a high single-digit revenue as well as double-digit earnings before interest and taxes growth for 2022, according to joint acting group CEO Vivek Sood.

“From an underlying operational performance, we are still fairly confident to exceed the key performance indicators set for ourselves.

“We are also cognisant that the macro situation in some countries is still not stable enough, which may have impact – things like forex (foreign exchange) implications as we had in the first half,” he told an online media briefing yesterday.

On its business in Sri Lanka, Vivek said there are no plans to exit the country.

“We see this (current economic crisis) as a temporary situation and also an opportunity.

“For example, Dialog is trying to consolidate from seven data centres to three. Once we pass this crisis, the company will be far more resilient as well as prepared to have much better outcomes,” he said.

The telecommunications and digital conglomerate has controlling stakes in market-leading mobile and fixed operators in the region including Celcom in Malaysia, XL and Link Net in Indonesia, Dialog in Sri Lanka, Robi in Bangladesh, Smart in Cambodia and Ncell in Nepal.

Also, Axiata’s regional digital business verticals comprise Boost, a fintech play, and ADA, a digital analytics and artificial intelligence company.

The group’s 63%-owned edotco provides end-to-end solutions in the tower services sector and operates in nine countries to deliver telecommunications infrastructure services.

Vivek pointed out that Dialog remains a strong brand in Sri Lanka.

Axiata joint acting group CEO Dr Hans Wijayasuriya added that “the expectation is that the Sri Lanka currency (rupee) will stabilise at this level, at least in the short run.”

“I think the currency could stabilise within the next few months, through the IMF (International Monetary Fund) arrangements,” said Wijayasuriya.

Vivek said Axiata is also “looking at some of these structural changes and working with the regulators, which should allow the (forex) volatility impact getting reduced.”

As for Axiata’s planned Rm7.1bil capital expenditure in 2022, he said the group has spent around Rm2.7bil.

“We would likely end up with Rm7bil or maybe slightly shorter than that for 2022. Some of the projects are still in the pipeline and have yet to be commissioned,” said Vivek.

As for the Aug 31 deadline for the acquisition of shares in 5G network provider Digital Nasional Bhd (DNB), Vivek said: “The discussions and direction have been positive.

“We’re progressing well. I think we are fairly close to both – on the commercial side as well as on equity investments.”

On the Celcom-digi merger, Vivek said: “It is progressing well. There are still a couple of steps to be carried out. We expect those things to be completed in time for us to complete the merger by end-2022.”

For the second quarter ended June 30, 2022 (2Q22), Axiata saw a net loss of Rm106.4mil compared with a net profit of Rm277.76mil a year earlier, although revenue grew 4.9% to Rm6.7bil.

Loss per share in 2Q22 was 1.2 sen versus earnings per share of three sen a year earlier.

For the first half (1H22), Axiata saw a net loss of Rm149.4mil compared with a net profit of Rm353.3mil a year earlier, although revenue grew 5.8% to Rm13.17bil.

Loss per share in 1H22 was 1.6 sen versus earnings per share of 3.9 sen a year earlier.

“We see this (current economic crisis) in Sri Lanka as a temporary situation and also an opportunity.” Vivek Sood