Period 1H12
for XL Axiata
Actual vs. Expectations
1H12 core NP of
Rp1.5T was in line and accounted for 48.4% and 45.9% of ours and the street’s
full year estimates, respectively.
Dividends No
dividend was announced during the quarter.
Key Result Highlights
YoY, 1H12 revenue
rose 13% to Rp10.3T driven by higher contribution from the SMS (+20%), Data
& VAS (+18%) and Voice (+7%) segments. With the growth in data, non-voice
revenue now contributed half of XL’s total usage revenue of Rp8.2T. The strong
data growth has led XL’s data users to increase by 32% to 26.5m with most of the
subscribers committed to either the Pay Per Use or Volume based data plans.
XL’s data users now accounted for 57.7% of the group’s total subscribers of
45.9m.
QoQ, revenue was up
by +8% while core net profit rose in tandem with the top line, coming in at
Rp798m (+7%). EBITDA margin was however lower at 47.7% (1Q12: 48.3%) due to
higher interconnection and direct expenses.
Total operating
expenses meanwhile increased by 22% YoY to Rp5.2T in 1H12 due to higher infrastructure
expenses of Rp2.5T(+42% YoY), caused by the increase in rental sites, towers
and leased lines expenses as a result of a higher base stations rollout and
higher 3G infrastructures.
2Q12 EBITDA increased
by +6% QoQ to Rp2.5T but with a lower margin of 47.7% vs. 48.3% in 1Q12. The
lower margin was mainly due to the acceleration in the infrastructure rollout
for data.
Outlook XL
Axiata is maintaining its targeted revenue to be within or above its peers’
expected growth in FY12 of 6.0-8.0%.
No change in its high
40’s EBITDA margin guidance.
The targeted FY12
capex guidance is maintained by the company at Rp7.0T-8.0T, with around 60%
allocated for data or the 3G network.
Change to Forecasts
We have fine-tuned
our Axiata’s FY12, FY13 and FY14 normalised net profit forecasts by +0.5%, +0.6%
and +0.9% respectively to RM2647m, RM2807m and RM2843m respectively.
Rating Maintain MARKET PERFORM
Valuation Axiata TP is maintained at RM6.25 based on a targeted
EV/forward EBITDA of 7.6x (+2 SD) Risks Regulation risks in its overseas ventures
Source: Kenanga
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