Telekom Malaysia Berhad financial results for the first half of the year ended 30 June 2018 show a decline in voice, data and other telecom revenue. That is an issue most telcos globally wil have to deal with as well. Telekom Malaysia posted revenue of RM5.78 billion year-to-date, 2.7 percent lower from RM5.94 billion in the corresponding period last year. In part, one might argue, that results from market saturation.
Group Reported Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) for the first half of 2018 was RM1.61 billion as compared to RM1.80 billion in the first half of 2017 mainly due to the lower revenue.
Stripping off non-operational items, such as unrealized forex loss on trade settlement, group normalized EBITDA was 13.9 percent lower, at RM1.60 billion. Group EBIT for first half of 2018 was RM444.5 million as compared to RM560.9 million in the first half of 2017. Stripping off some non-operational items, including foreign exchange loss on international trade settlement, normalised EBIT stood at RM433.0 million.
“The first six months of 2018 has been very challenging for us, from rapid developments in the market to increasing regulatory pressures,” said Datuk Bazlan Osman, Telekom Malaysia Group CEO.
In the second quarter, group revenue stood at RM2.94 billion, lower by 1.5 percent year over year. Group EBIT stood at RM248.9 million, lower by 3.2 percent, year over year. On a normalized basis, EBIT was lower by 25.6 percent year over year, dropping to RM226.4 million from RM304.5 million in the second quarter of 2017.
In fact, at least think a major wave of consolidation lies ahead, caused at least in part by spectacular change in revenue sources. And much of that change is driven by changes in the value of access.
Massive consolidation, reducing the number of global tier-one carriers by about 90 percent is what some believe is coming.