Maxis starts the year with strong Q1 performance
- Service Revenue at RM2,112 million, up 4.0% YoY
- Improved EBIT at RM541 million, up 3.4% YoY
- Profit After Tax at RM320 million, up 7.4% YoY
- Declares interim dividend of 4 sen net per share for the quarter
Maxis Berhad (Maxis) started 2023 with an all-round strong Q1 performance, with service revenue increasing 4.0% year-on-year (YoY) to RM2.1 billion and EBIT increasing 3.4% YoY to RM541 million, despite a challenging operating environment. Driven by strong execution of its integrated telco strategy, the Company delivered growth in both core mobile and fixed line connectivity services across its Consumer and Enterprise businesses and improved profit margins from lower operational costs. Profit After Tax at RM320 million, is up 7.4% YoY. Maxis declared an interim dividend of 4 sen net per share for the quarter.
As Malaysians increasingly rely on seamless always-on connectivity and digital experiences at home, work and on the go, Maxis’ mobile and fixed line offerings continue to attract customers, resulting in revenue growth for these segments. Initiatives to optimize customers’ home connectivity experience contributed towards double digit growth in fiber broadband revenue.
Maxis’ Enterprise business continued to deliver stable revenue growth, which was further enhanced by its ICT solutions offerings. With businesses maintaining an appetite to invest in varying levels of digital transformation, Maxis intends to expand and harvest the full potential of its enterprise offerings portfolio, leveraging its strength of core connectivity.
With more consumers and businesses connecting to its network, Maxis remains committed to providing the best connectivity experience. During the quarter, Maxis invested RM130 million in capex to maintain network quality to serve its customers better and to meet the growing bandwidth demands of an increasingly digital environment.
Maxis recognises the economic benefits that 5G will bring to Malaysia and will fully leverage its resources, skills and infrastructure to build a 5G network of the highest quality and reliability. Maxis looks forward to providing 5G-related products and services to its customers soon, with a focus on affordability and adoption.
We are pleased with our strong start to the year. As we strengthen our position as an integrated player, we will focus on sustainable and predictable growth and strong across-the-board execution to deliver the best service to our customers. - Goh Seow Eng, Maxis CEO
Q1 2023 financial highlights – Q1 2023 vs Q1 2022:
- Service Revenue at RM2,112 million, up 4.0% fueled by strong growth from both Consumer and Enterprise businesses.
- Postpaid revenue grew 10.1% to RM864 million driven by growth in Maxis Postpaid and Hotlink Postpaid. Effective pre-to-post migration strategy resulted in increasing overall Postpaid subscriptions by 6.5%, bringing the total number of postpaid subscriptions to 3.4 million with a stable ARPU at RM78.
- Prepaid recorded resilient revenue growth of 0.6% to RM661 million amidst a highly competitive landscape. Continued adoption of Hotlink Prepaid plans helped to sustain a healthy subscriber base at 5.7 million and strong ARPU at RM38 despite an overall contracting prepaid market.
- Home Connectivity revenue increased by 11.0% to RM222 million, delivering healthy customer growth attributed to competitive converged services offering. Total home connections reached 688k boosted by active conversion of WBB customers to fibre customers.
- Enterprise revenue (excluding wholesale voice) was up by 5.5% to RM365 million.
- EBIT increased by 3.4% to RM541 million due to higher service revenue and stable recurring resource costs, excluding one-offs in 1Q22.
- Profit after tax increased by 7.4% to RM320 million as a result of higher EBIT and discontinuation of Prosperity Tax charges in 2023.
- Operating free cash flow is at RM181 million with a stable cash balance of RM340m as at 1Q23.
Key initiatives in Q1 2023:
- Teamed up with the Malaysian Agricultural Research and Development Institute (MARDI) to collaborate and co-develop smart agricultural and agrifood-based solutions.
- Partnered with Ideal Property Group, a market-leading property developer in Penang, to bring superior internet experience and attractive fibre propositions to 12,000 residential and key commercial developments in Penang
- Hotlink Prepaid and Hotlink Postpaid plans enhanced with more internet quota at greater value. Hotlink also introduced more exciting rewards and exclusive benefits with new partner deals.
- Supported government initiatives to provide affordable internet and mobile connectivity to targeted segments by offering Hotlink Pakej Perpaduan and Maxis Home Fibre Pakej Perpaduan.
- eKelas, Maxis’ flagship community programme, launched the enhanced eKelas portal and mobile app for all round improved user experience. The programme also introduced two new subjects – Bahasa Malaysia and History – for Form 4 and Form 5 students.