DiGi posts 31% jump in Q2 earnings

PETALING JAYA: DiGi.com Bhd's net profit for the second quarter ended June 30, 2014 rose 31.3% to RM498.91 million from RM380.01 million a year ago, fuelled by increased demand for internet services.
DiGi's stronger service revenue growth and efficient cost structure also lifted earnings before interest, tax, depreciation and amortisation (ebitda) by 6.4% year-on-year to RM795 million. Revenue jumped 5.6% to RM1.75 billion from RM1.65 billion, supported by solid growth on internet revenue.
For the six-month period, it saw a net profit of RM984.07 million or a growth of 38.9% compared with RM708.66 million in the previous corresponding period, while revenue also surged 5% to RM3.46 billion from RM3.3 billion a year ago.
DiGi CEO Henrik Clausen said the steady growth in internet revenue was a result of its stronger customer and quality focus.
"We've been persistent in driving quality experience on our brand new network, enhancing voice stability and ensuring effective data network management to give customers consistent and stable data speed, especially on commonly used mobile applications," he said in a statement yesterday.
Additionally, it continued to expand its 3G HSPA+ coverage to 82.7% of populated areas, and grew its fibre network to 4,400km.
"In recent months, we've leveraged on our stronger network capability and wider coverage to reach out to more customers and drive consumption of internet. We've proactively made internet services part of our core offering across various customer segments."
During the quarter, DiGi grew its internet customers to 4.3 million. Smartphone penetration among its 10.9 million customers also increased to 41.9% from 30.4% a year ago.
"We've invested RM193 million in capital expenditure during the quarter to grow and improve our network, and we're on track to spend up to RM900 million to continue strengthening our network position.
"Our ambition is to grow our 3G HSPA+ footprint to 86% of the population, increase our LTE sites to 1,500 nationwide and expand our fibre network by the end of this year. We'll also be introducing relevant and innovative new device and service offerings to further encourage internet usage on DiGi's network," said Clausen.
In view of a stronger earnings per share, DiGi will pay a second interim tax exempt dividend of 6.4 sen per share.