Axiata announces exit from Myanmar, posts RM1.99bil net loss in FY23

NST Thu, Feb 22, 2024 04:19pm - 1 month View Original

KUALA LUMPUR: Axiata Group Bhd, which posted a net loss of RM1.99 billion for the financial year ended Dec 31, 2023, said it is exiting Myanmar as part of its value erosion management efforts.

The group said earnings in 2023 was impacted by Nepal's NCell Axiata Ltd and Edotco Myanmar asset impairment, higher net finance cost and lower share of results of CelcomDigi Bhd, relative to Celcom's contribution as a subsidiary in 2022.

This is compared to a net profit of RM9.75 billi in the previous year.

Revenue for FY23 rose to RM22 billion versus RM22.02 billion the previous year supported by growth across all operating companies except Boost.

Axiata stated the uncertain and deteriorating operating environment and risk of further value erosion led to the decision of exiting Nepal and Myanmar in FY23. "Disposal of Nepal operations was completed on Dec 1, 2023 while discussion on the sale of Edotco Myanmar is ongoing," it said in a statement.

For the fourth quarter ended Dec 31, 2023, the company posted a net loss of RM695.02 million versus a profit of RM9.95 billion in Q4 2022.

This was mainly impacted by one-off net gain on disposal of Celcom amounting to RM13.53 billion, offset with impairment of goodwill of mobile operations in Nepal amounting to RM2.6 billion in Q4 2022 as compared to one-off net loss on disposal of Reynolds Group of RM356.4 million in Q4 2023.

Revenue for the period rose 7.2 per cent year-on-year (YoY) to RM5.79 billion compared to RM5.4 billion in Q4 2022 mainly contributed by all operating companies except mobile operations in Sri Lanka, fixed broadband operations in Indonesia and digital business (Boost).

Axiata chairman Tan Sri Shahril Ridza Ridzuan said the company took tough, decisive actions to exit the deteriorating operating environments of Nepal and Myanmar in FY23. "These decisions allow management to focus on assets that can create future value for shareholders.

"We remain focused on excellent execution of our strategies to achieve our aspiration as a sustainable dividend company," he said.

For 2024, he said the board continues to focus on solid business fundamentals as Axiata accelerates its pace in the journey towards Telco-TechCo status and transforms its portfolio.

"As we continue our progress towards our goal of becoming The Next Generation Digital Champion, sustainability matters in the areas of digital inclusion and climate action will remain a top priority.

"We have commenced the validation process with the Science Based Targets initiative (SBTi) to substantiate our near-term and long-term net-zero targets, demonstrating our commitment to evidence-based climate action," he added.

Chief executive officer and managing director Vivek Sood said moving forward, the company looks forward to its telco-techco journey, as it evolves to become an integral player in the region's digital and technology ecosystem.

"We remain confident that through our refreshed corporate strategy of delivering value through five vectors and five strategic priorities, we will continue to reshape our portfolio to unlock value and build on new opportunities to create value from sustainable businesses," he said.

The company declared a second dividend per share of 5.0 sen, bringing the total dividend per share for FY23 to 10.0 sen.

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