25 May 2022
TM records steady performance in 1Q2022 with revenue & PATAMI up 2.9% & 4.4%; maintains focus on its growth strategies execution
In the second year of its Transformation, the Group is on track to achieve its 2022 market guidance, focusing on strengthening its core businesses and investing in new growth areas
Telekom Malaysia Berhad (TM) continued its growth trajectory and long-term business sustainability, recording a steady performance in its First Quarter ended 31 March 2022 as compared to the same period last year (YoY).
The Group's operating revenue increased by 2.9% to RM2.89 billion, compared to RM2.81 billion in the same quarter last year, driven primarily by increased demand for voice, Internet and multimedia. Despite rising competition to offer converged solutions among telco and other technology players, TM continued to deliver strong customer growth across its operations.
Capitalising on its core businesses and investing into new growth areas, TM further ramped up its transformation initiatives, delivering profit after tax and non-controlling interests (PATAMI) for the quarter at RM339.9 million or 4.4% higher than the RM325.5 million recorded in 1Q2021. The Group also recorded lower financial costs subsequent to the early redemption of its RM2.0 billion sukuk in March 2021, as well as lower foreign exchange translation losses on borrowings. The Group has applied the Cukai Makmur statutory tax rate accordingly for the current quarter.
Accelerating into the second year of its Transformation, TM brought forward its manpower optimisation to enable earlier realisation of expected benefits to the Group. This, along with foreign exchange impact on trade settlement has led to a 5.0% decrease in EBIT at RM560.4 million for 1Q2022 compared to RM589.7 million in the same quarter last year. Excluding these costs, the Group's underlying EBIT is 14.0% higher at RM650.2 million compared to RM570.5 million in 1Q 2021. Free Cash Flow is lower by 15.1% at RM658.8 million compared to RM775.7 million due to higher CAPEX as the Group continues to invest in business expansion and meeting customers' demands through technology refresh and network delivery, ensuring steady growth.
unifi: Double-digit revenue and subscriber growth
unifi continued its growth performance, recording revenue increase of 10.6% from RM1.25 billion to RM1.38 billion in the current quarter. Sustained by increasing demand from Internet, voice and sales of devices, with cumulative fixed Internet subscribers increasing by 17.5% against the corresponding quarter last year. unifi remains the largest growth contributor for the Group.
unifi will continue to maintain its leadership in fixed broadband and enhance its Fixed-Mobile Convergence (FMC), enriched with TV and streaming content. This reflects its commitment to improve its FMC customer experience with better and seamless service. unifi will also grow its SME digital platform as a one-stop service centre for solutions catering especially to SMEs nationwide.
TM Wholesale (TMW): Higher revenue from increased demand for data services
TM Wholesale (TMW) also recorded a growth performance for 1Q2022, with revenue increasing by 1.2% from RM631.9 million in 1Q2021 to RM639.5 million, mainly contributed by higher revenue from voice and data services. This was underpinned by increasing demand from High-speed Broadband Access (HSBA) and higher International Voice and Data.
To date, TMW continues to enable industry broadband and 4G network via its fibre infrastructure, with the ongoing 5G rollout further strengthening that role. On the international front, it will continue to serve other OTTs and hyperscalers with connectivity and data centres, while regionally, TM Wholesale aspires to establish Malaysia as a digital hub for ASEAN via new submarine cables, enhanced data centre solutions and edge computing.
TM One: Renewed focus on growing B2B digital solutions market
TM One, the Group's enterprise and public sector arm, recorded a 7.4% decrease in revenue from RM925.2 million to RM856.8 million in 1Q2022 due to decline in data services revenue.
Strengthening and growing its B2B digital solutions, TM One has focused its efforts on high potential industry verticals, namely healthcare, manufacturing, education, oil & gas, banking, financial services & insurance (BFSI) and public sector. It has entered a partnership with Tune Protect and Huawei Malaysia that saw Tune Protect becoming the first organisation in Malaysia to host an insurance core system on public cloud (Cloud αEdge).
Commentary and Outlook from Imri Mokhtar, TM Group Chief Executive Officer
"With our economy and borders reopening, TM is powering Malaysia's journey on its road towards recovery, by ensuring the vision of an inclusive and extensive Digital Malaysia becomes a reality.
"Into the second year of our Transformation, we are focused on strengthening our core business while investing into new growth areas to meet customers' demands. In ensuring sustainability in the long run, we continue to grow our profitability to invest and seize opportunities arising from digital acceleration.
"One of these opportunities is in the exciting space of digital solutions and services for enterprises. Building on TM One's existing capability and relationships with enterprises and the public sector, we will deliver speed and agility through our new digital arm Credence: a corporate start-up led by technology leaders.
"unifi continues to better its fixed broadband and Fixed-Mobile Convergence value proposition to improve customer experience, while expanding our offerings to provide quality entertainment to customers at home or on-the-go.
"We have also achieved some key milestones in our sustainability efforts. TM One has successfully secured the Green Electricity Tariff from Tenaga Nasional Berhad for its data centres in Kuala Lumpur, Cyberjaya and Johor Bahru, contributing to a lower carbon footprint as the demand for cloud storage inevitably increases. This is in addition to the existing Green Building Index (GBI) certification earlier obtained for its core data centres. TM's broader ESG commitment also remains consistent with Malaysia's initiatives towards achieving net-zero Greenhouse Gas emission for the country by 2050.
"Meanwhile, TM Wholesale continues to establish Malaysia as a regional digital hub via new submarine cables, edge computing, data centres and supporting international connectivity. On the domestic front, TM Wholesale continues performing its role as the enabler for industry broadband, 4G and 5G network via fibre infrastructure that will transform the nation's connectivity capabilities."
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TM Joins Asia Link Cable System Consortium To Boost Submarine Cable Capacity From Malaysia To Asia
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TM Future Skills Programme continues with a project based learning e-showcase event
Two (2) schools participated in E-Showcase PBL-TM Future Skills 2020, the highlight of a 3-month online learning programme for teachers and students of the schools Telekom Malaysia Berhad (TM) continues its efforts to equip the younger generation with Industrial Revolution 4.0 (IR4.0)-centric knowledge through initiatives under its TM Future Skills programme. Most recently, students from Sekolah Jenis Kebangsaan Cina (SJKC) Jalan Davidson, Kuala Lumpur and SJKC Tsun Jin, Kuala Lumpur demonstrated their talents in 3D programming and printing skills in a two (2)-days online event held in collaboration with Bangsar / Pudu District Education Office (PPDBP). The event, titled E-Showcase Project Based Learning (PBL)-TM Future Skills 2020, saw the participation of 60 teachers and students from both schools. The students showcased their 3D innovation projects and at the same time, shared and displayed their knowledge and skills in Science, Technology, Engineering and Mathematics (STEM) subjects. Izlyn Ramli, Vice President, Group Brand and Communication, TM, said: “We are delighted with the schools’ acceptance and active participation in the TM Future Skills Programme. Our Corporate Social Responsibility (CSR) programmes under the education pillar are always aimed at supporting the nation’s education system towards preparing not only the students, but also the teachers and society at large, with IR4.0 skills. We hope this programme will help to enhance the students' future skills and increase their interest in STEM subjects. This befits our role as a responsible nation builder where we will continue to serve and enable Digital Malaysia through innovative and inclusive digital solutions.” Teah Lay Theng, Headmistress of SJKC Jalan Davidson, said: “The PBL approach was chosen for the programme as it can bring out the most from the students in terms of innovation and creativity. The use of digital equipment is also able to improve the digital skills and competencies of our students in producing the innovations.” Meanwhile, Ng Mooi Hong, Headmistress of SJKC Tsun Jin, said: “In the current pandemic environment, teachers need to be creative in imparting knowledge and running the programmes that can develop the potential of our students. With this programme, we hope to inoculate the interest, highlight the potentials and empower the students with STEM subjects.” The E-Showcase PBL-TM Future Skills 2020 was the highlight of three (3) months long online learning programme for teachers and students of the two (2) schools. Throughout the programme, the teachers and students from both schools learned about digital technology in TM 3Ducation – the 3D printing module to be implemented in their PBL. Due to the ongoing pandemic Covid-19, TM’s strategic partner for TM Future Skills, Creative Minds, conducted the training sessions for all the teachers and students, including parents, through an online platform. Not being in class physically following the closure of schools nationwide has also not deterred these young innovators. They persevered in conducting research and continued to experiment and collaborated with each other virtually for the past 3 months. At the same time, School Improvement Specialist Coach (SISC+) from PPDBP closely supervised the activities and monitored the progress of the participants. Streamed live via YouTube, the E-Showcase garnered more than 6,000 viewers throughout the 2-day event and the channel has cumulated more than 7,800 views to date. The panel of judges for the E-Showcase consisted of SISC+ from PPDBP and led by Izad Ismail, Head of Corporate Responsibility, TM. TM Future Skills programme is an initiative that aims to empower students by equipping them and teachers with IR4.0-centric kits and knowledge, such as the TM 3Ducation – 3D printing module and the TM Nano Maker, a real-time data logging tool for STEM. This is to prepare them to be part of a digital-ready community and future-proof workforce which has always been one of the pillars under TM’s Digital Malaysia aspiration. As a key enabler of this, TM has always been an avid supporter of innovation and technology in Education. Through programmes like TM Future Skills, the Company endeavours to empower the leaders of tomorrow with relevant skills in innovation and technology towards serving a more digital society and lifestyle, digital businesses and industry verticals, as well as digital Government. For more information on the Company's other Corporate Responsibility initiatives, visit www.tm.com.my.
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