- Higher depreciation allocation and foreign exchange currency loss due to the weaker ringgit proved to be a drag on Telekom Malaysia Bhd’s
Higher depreciation allocation and foreign exchange currency loss due to the weaker ringgit proved to be a drag on Telekom Malaysia Bhd’s (TM) pretax profit – which fell to RM256.1 million for the second quarter ended June 30, 2015 from RM309.4 million in the previous corresponding quarter.
While revenue of 2.84 billion was essentially flat, TM had increase depreciation to RM623.9 million (2014: RM560.2 million) and incurred a RM14.5 million foreign exchange loss (2014: RM7.1 million gain) in the latest quarter.
The latest quarter pretax profit was up 48.8% from RM172.1 million in the previous quarter while revenue rose 2.4% from RM2.77 billion previously.
On a cumulative basis, the pretax profit slipped to RM428.2 million (2014: RM589 million) while revenue was up slightly at RM5.61 billion (2014: RM5.44 billion).
TM said the latest quarter growth was mainly due to higher contribution from voice and other telecommunications-related service revenue.
Continuing to be the dominant fixed broadband player, TM’s total broadband customer base grew 1% to almost 2.29 million customer as its UniFi service was up 3.3% from the preceeding quarter with a quarterly net addition of about 25,000 customers to close to 782,000 customers activated as at the end of the second quarter
Group chief executive officer Tan Sri Zamzamzairani Mohd Isa said total capital expenditure for the first half was RM686 million or 12.2% of revenue, of which RM428 million was spent in the second quarter.
A single-tier interim dividend of 9.3 sen per share or RM349.5 million has been proposed.
TM also said it does not see any need for debt-restructuring in the wake of steep declines in the ringgit as only a small portion of its borrowings are not hedged, Reuters reported.
TM said only 12% of its total borrowings worth RM6.9 billion was unhedged. “We only have US$200 million which is unhedged, and it is long dated, due only in 2025,” said chief financial officer Bazlan Osman.