Astro 2Q net profit swells 10 times to RM169.34m despite lower revenue

This article first appeared in The Edge Financial Daily, on September 13, 2019.
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KUALA LUMPUR: Astro Malaysia Holdings Bhd’s net profit for the second quarter ended July 31, 2019 (2QFY20) swelled to RM169.34 million, ten times more than RM16.58 million a year ago on the back of lower finance costs and higher earnings before interest, taxes, depreciation and amortisation.

The group said in a bourse filing that earnings per share (EPS) rose to 3.24 sen from 0.32 sen last year.

Astro declared a second interim dividend of two sen a share with an entitlement date of Sept 30 and payment on Oct 11, bringing a total dividend payout for the first half of the year (1HFY20) to four sen, from five sen a year ago.

Despite a higher quarterly net profit, revenue slid 12.71% to RM1.24 billion from RM1.42 billion last year, on lower subscription revenue, licensing income, advertising revenue and merchandise sales.

Astro chief executive officer Henry Tan said the group is “putting in place building blocks for new revenue adjacencies, specifically in broadband and content bundles with Maxis and in OTT (over-the-top) through our strategic partnerships with iQIYI and HBO Asia; with more partnerships in the coming months”.

Net profit for 1HFY20 jumped 80.62% year-on-year to RM345.53 million, from RM191.31 million in the corresponding period last year, translating into a higher cumulative EPS of 6.63 sen, from 3.67 sen last year.

Half-year revenue declined 9.41% to RM2.47 billion from RM2.73 billion.

On its outlook, the group said: “The market remained challenging with structural changes in the global content, media and advertising industries, including threat of piracy.”

The group will continue to fortify its core pay-TV and NJOI businesses by redefining customer value propositions, elevating customer service and refreshing content, in addition to continuing cost optimisation efforts.

Astro shares closed a sen or 0.74% lower to RM1.34 yesterday, valuing the company at RM6.99 billion. The counter saw 1.86 million shares traded.