Wednesday, November 26, 2008

TMI third quarter net profit fell ...

TMI's Q3 net profit fell by more than 25 per cent, mainly due to the lack of one-off gains and higher finance cost.

No foreign exchange losses for TMI
Unlike sister company TM, TMI's weaker Q3 numbers were not due to foreign exchange losses, thanks to its hedging policy (at subsidiary level).


TMI, at group level, does not have any foreign debt. Its subsidiary PT Excelcomindo (XL) has USD debts, it was understood that half of XL debts are hedged.


Celcom vs DiGi in Q3 and YTD.

Q3 Revenue: Celcom RM1.42 billion (+10% yoy), DiGi RM1.22 billion (+10% yoy).
9-month Revenue: Celcom RM4.135 billion (+10% yoy), DiGi RM3.58 billion (+12.5 % yoy).

Q3 Net Profit: Celcom RM327m (+25% yoy), DiGi RM270m (-1% yoy)
9-month Net Profit: Celcom RM958m (+28% yoy), DiGi RM858.4m (+11.5% yoy)

Q3 Net Addition: Celcom +360k (+126k postpaid, +234k prepaid), DiGi +166k (+126k postpaid, 40k prepaid)
9-month Net Addition: Celcom +1.05m (+309k postpaid, +742k prepaid) DiGi +394k (+270k postpaid, +124k prepaid)
YTD subscriber growth: Celcom + 14%, DiGi +6%
YTD postpaid subscriber growth: Celcom +24%, DiGi +38%

Ebitda margin: Celcom 45.3%, DiGi 42.7%

Postpaid ARPU: Celcom RM102, DiGi RM89
Prepaid ARPU: Celcom RM47, DiGi RM54

Finalising capital structure

Currently, TMI’s balance sheet carries short term debts amounting to RM10.45 billion which is due in 2009. This includes the RM6.45 billion bridging loan for the acquisition of Idea and the RM4 billion outstanding to TM. TMI has decided on a two-pronged approach to address this via a short term solution and a longer term one.

The Group will prepay RM2 billion in respect of amount owed to TM via a new banking facility that matures at the end of 2011. The remaining RM2 billion will be repaid via internally generated funds in accordance with the terms of the demerger due in April 2009, which will also result in lower interest cost for the Group.

The RM4.85 billion bridging loan has been converted to a 3 year term loan, maturing in 2012. The Group is currently in negotiations to term out the remaining USD500 million (RM1.6 billion) to 2012. The Group has been able to address the short term refinancing risks despite current weak credit market.

With the terming out of the short term debts, TMI is concurrently looking to achieve an optimal capital structure through equity or equity like instruments. It is the intention of TMI Group to utilise the new capital to reduce the overall debt position within the 3 year period. Due to the multiple options available to TMI the Group expects to finalise the structure by 1Q 2009.

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