Period 1Q12
Actual vs. Expectations
1Q12 core NP of RM687m was above our expectation as well as
that of market consensus. The core earnings accounted for 27.8% and 25.2% of
ours and the street’s full year estimates. The higher core NP was mainly due to
the better than expected margins and higher contributions from associated
companies.
Dividends No dividend was announced during the quarter.
Key Result Highlights
YoY, revenue rose 8% to RM4.26b driven by higher
contribution from all key operating companies despite the continuing strength
of the Ringgit. On a constant currency basis, revenue would have grown 10.4%.
EBITDA grew 4.1% but the margin dipped by 1.5pp to 42.4% mainly due to
aggressive network roll-out cost in Indonesia to accommodate data growth. Core NP,
however, increased by 8.2% thanks to higher operational contribution and a
lower effective tax rate (15.4% vs. 19.4%).
QoQ, turnover was flat at -0.2% while the core NP was up by
+17.4%, mainly boosted by the lower operational costs coupled with higher contribution
from its associate companies, leading its PBT to grow by 29.2% to RM905m.
Celcom performed very well with revenue growing 10% YoY to
RM1.9b but with lower EBITDA margin of 44.0% vs. 46.7% in 1Q11. Broadband grew
15% YoY to RM215m with advanced data (excluding SMS) and voice revenue growing
12% YoY and 7% YoY to RM420m and RM1.3b respectively.
Outlook Maintained FY12 headline KPIs target (Revenue
+5.3% YoY; EBITDA +1.8% YoY) and capex guidance of RM4.4b.
Change to Forecasts
Raised FY12, FY13 and FY14 core PAT by 6.8%, 6.7% and 5.5%
respectively to RM2.63b, RM2.75b and RM2.81b after raising 1) a higher EBITDA
margin (42.3% vs. 41.9%) and 2) a higher associate companies contribution.
Rating Maintain MARKET PERFORM
Valuation Inline with the revision in earnings, Axiata
TP has been raised to RM5.52 (from RM5.30 previously), based on an unchanged
targeted EV/forward EBITDA of 7.1x (+1.5 SD).
Risks Regulation risks in its overseas ventures.
Source: Kenanga
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