Thursday 28 Mar 2024
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KUALA LUMPUR (May 20): Axiata Group Bhd's Malaysian and Indonesian units are expected to underpin the mobile-telecommunication network operator's second half earnings recovery, group chief executive officer Datuk Seri Jamaludin Ibrahim said.

Jamaludin said Axiata's (fundamental: 0.85; valuation: 1.1) two "engines of growth", Celcom Axiata Bhd in Malaysia and XL Axiata, in Indonesia were expected to support the group's earnings recovery in the second half ending Dec 31, 2015 (2HFY15).

He said at a press conference after Axiata's annual general meeting here today that improved earnings from Celcom could be expected, as last year's system-related issues, which impacted earnings, had been resolved.

Jamaluddin said "dozens of initiatives" to win back dealers and distributors' confidence were being carried out, following Celcom's IT transformation last year.

On Indonesia, he said the shift in XL's strategy from targeting low-end users to higher value mid-range users in Indonesia, would start to bear fruit.

Jamaluddin said XL's earnings would pick up in 2HFY15. This follows XL's losses due to its acquisition of Axis Telekom Indonesia and foreign exchange losses.

XL's financials have resulted in lower profit at Axiata. Yesterday (May 19), Axiata announced net profit for 1QFY15 fell to RM584.84 million, from RM674.88 million a year earlier.

Revenue however, increased to RM4.75 billion, from RM4.51 billion.

Today, Axiata's shares fell three sen or 0.4% to RM6.72, for a market capitalisation of RM57.79 billion.

Some seven million shares changed hands.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)

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