Dialog Consolidates Performance with Strong 3rd Quarter results

Dialog Axiata PLC announced, Wednesday 05th November 2014, its consolidated financial results for the nine months ended 30th September, 2014. Financial results included those of Dialog Axiata PLC (the "Company") and of the Dialog Axiata Group (the "Group") post-consolidation with subsidiaries Dialog Broadband Networks (Pvt) Ltd ("DBN"), and Dialog Television (Pvt) Ltd ("DTV").

The Group continued its strong growth momentum across Mobile, Digital Pay Television, Tele-infrastructure and Fixed Line businesses to record a consolidated revenue of Rs. 17.0Bn for Q3 2014 and Rs. 50.0Bn for the nine months ended 30th September 2014 respectively, representing an increase of 2% Quarter on Quarter (“QoQ”) and 6% Year to Date (“YTD”). On the backdrop of strong revenue growth, Group EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) grew by 4% QoQ to be recorded at Rs. 5.5Bn for Q3 2014. The Group EBITDA for the first nine months of the year was recorded at Rs. 15.4Bn, up 1% compared to the corresponding period in 2013. Group YTD EBITDA margin was registered at 31%.

The Group NPAT (Net Profit After Tax) for Q3 2014 was recorded at Rs. 1.7Bn, an increase of 2% QoQ on the back of growth in Group EBITDA. Group NPAT for the nine months ended 30th September 2014 was posted at Rs. 4.6Bn, an increase of 13% YTD.

At an entity level, Dialog Axiata PLC ("the Company") featuring the Mobile, International and Tele-Infrastructure segments of the Group portfolio continued to contribute a major share of Group Revenue (85%) and of Group EBITDA (89%). Company revenue grew by 2% QoQ on the back of its 9 Million over Mobile subscriber base to reach Rs. 14.7Bn in Q3 2014. Revenue for the nine months ended 30th September 2014 was recorded at Rs. 43.3Bn, up 5% relative to the corresponding period in 2013. Underpinned by robust performance in Revenue, Company EBITDA reached Rs. 4.9Bn in Q3 2014, representing an increase of 3% QoQ. Company EBITDA for the first nine months of the year increased by 2% YTD to reach Rs. 13.8Bn. Company NPAT for the quarter was recorded at Rs. 2.0Bn whilst the Company’s NPAT for the first nine months of the year was recorded at Rs. 5.4Bn compared to a NPAT of Rs. 4.4Bn in the corresponding period due to growth in EBITDA and recognition of a foreign exchange gain in contrast to a foreign exchange loss in 2013.

Dialog Television (DTV), the Digital Pay Television business of the Dialog Group continued its growth momentum, recording revenue growth of 29% YTD to reach Rs. 3.4Bn for the first nine months of 2014. DTV EBITDA was recorded at Rs. 690Mn for the same period, an improvement of 55% YTD driven by strong revenue growth. On the backdrop of growth in EBITDA, Net Profit for the nine months ended 30th September 2014 was recorded at Rs. 252Mn, compared to a net loss of Rs.19Mn posted for the corresponding period in 2013. The company’s Pay TV subscriber base grew by 36% YoY to be recorded at 410,000 subscribers as at end Q3 2014.

Dialog Broadband Networks (DBN) featuring the Group's Fixed Telecommunications and Broadband Business recorded revenue of Rs. 4.5Bn for the first nine months of the year, representing an increase of 3% YTD. Following the expiration of VAT credits totalling to Rs. 392Mn recognised during the corresponding period in 2013, DBN EBITDA contracted 26% YTD to reach Rs. 909Mn. DBN’s net loss for the same period was recorded at Rs. 924Mn relative to the net loss of Rs. 280Mn in the corresponding period of 2013. Negative NPAT performance was attributed to the decline in EBITDA in combine with the increase in depreciation due to Fixed 4G-LTE related investments.

Group capital expenditure for Q3 2014 amounted to Rs. 4.0Bn and was focused on investments in high speed broadband infrastructure to support the Group’s strategy to consolidate and grow its leadership in the data space. Group Free Cash Flow (FCF) was recorded at Rs. 1.1Bn for Q3 2014 on the back of improved EBITDA. The Dialog Group continued to exhibit a structurally robust balance sheet with Net Debt to EBITDA ratio improving from 1.2 times as at end of Q2 2014 to 1.03 times as at end of Q3 2014. The Dialog Group was reaffirmed a Fitch National Long Term Rating of ‘AAA (lka)’/Stable in September 2014.