Telecommunication Issue #9

1. TM’S FY2008 REVENUE UP 4.6% to RM8.67 BILLION

Telekom Malaysia Berhad (TM) finished the year 2008 with an improved performance driven by growth in broadband and data. For the financial year ended 31 December 2008, TM posted a revenue of RM8,674.9 million, a growth of 4.6% from RM8,296.0 million recorded in 2007. The Company continued to win new customers and maintained leadership position in the broadband segment registering 1.6 million customers as at end of 2008, a growth of 26.7% from 1.2 million customers a year ago.
TM also announced a proposed final gross dividend of 14.25 sen per share less tax of 25%, amounting to RM382 million. Combined with the interim dividend of 12 sen per share less tax of 26% paid in September 2008, the total dividend in respect of financial year 2008 is 26.25 sen per share, which translates into a total dividend payout of RM700 million

2. XL swings into loss despite strong subscriber growth

Indonesia’s third largest mobile operator by subscribers, PT Excelcomindo Pratama (XL), reported full-year losses of IDR15 billion (USD1.26 million) for 2008 despite increasing its subscriber base by a healthy 68% to 26 million, a fact it attributes to higher interest rates on loans it assumed and foreign-exchange losses. The company posted year-on-year revenue growth of 45% to IDR12.2 trillion, said XL president Hasnul Suhaimi, ‘driven by a 705% increase in our total [voice] minutes to 54.9 billion minutes, and 68% growth in our subscriber base.’ He added that the firm’s strategy of offering a high quality service at lower prices ‘helped us gain about 5% market share in terms of revenue’. Earnings before interest, taxes, depreciation and amortisation (EBITDA) climbed 46% y-o-y to IDR5.13 trillion last year, while the EBITDA margin remained stable at 42%. Hasnul said that XL booked higher than expected interest expenses in FY2008, relating to additional loans it took out. Excluding the impact of FOREX and other losses, the operator would have booked normalised net income of IDR348 billion, he added.

In 2008 Excelcomindo invested heavily in its networks and services, Hasnul noted, upgrading both its hardware and software platforms to improve subscriber and traffic capacity levels. XL deployed an additional 5,572 base transceiver stations (BTSs) last year, at a total cost of USD1.2 billion, to end the year with a total of 16,729 BTSs. The CAPEX forecast for 2009 is a less ambitious USD600-USD700 million, which will be targeted at selected investment projects, he said.

3. Saudi cellco sees stronger than expected sales

Zain Saudi Arabia, the cellular operator which began commercial operations last August, has reported revenues of SAR505.2 million (USD135 million) for the 120-day period from its launch to the end of December, exceeding its own revenue targets by 27%. Active customers totalled 2.01 million at the end of 2008, which the firm says represents a 7% share of all Saudi users. Gross profit for the period stood at SAR16 million, though hefty start-up and initial operating costs left the company facing a net loss of SAR2.28 billion. Zain competes with the Kingdom’s two established cellular providers, STC and Mobily.

SUBMARINE CABLE CUT

1. APCN2 System: Cable cut at Segment 1 between Kuantan (Malaysia) and Katong (Singapore)Cable Station at 7 KM from repearter 1.
2. APCN2 System: Cable Shunt Fault at Segment 7 between Shantau and Tanshui Cable Station.