Dialog profitability improves in 1H, revenue recorded at Rs 97.7 Bn up 20% YTD

Dialog Axiata PLC concluded the 1H 2023 with positive revenue performance being recorded across all business segments, namely, Mobile, Fixed Line, Digital Pay Television, International and Tele-infrastructure to record a consolidated Revenue of Rs97.7Bn, demonstrating a growth of 20% Year-to-Date (“YTD”).

However, Revenue declined 5% Quarter-on-Quarter (“QoQ”) to reach Rs 47.7 Bn for Q2 2023 due to drop in non-core revenue resulting from LKR appreciation against the USD. Group Earnings Before Interest, Tax, Depreciation and Amortisation (“EBITDA”) maintained flattish and marginally declined by 1% YTD to record at Rs 27.2 Bn.

The EBITDA for Q2 2023 was recorded at Rs14.2 Bn up 9% QoQ as cost rescaling initiatives gained more traction to record a saving of Rs 5 Bn for the quarter (Rs7.5Bn for 1H 2023). Overall, the core business remained resilient to record a core EBITDA margin of 40.2% for 1H 2023.

The Group Net Profit After Tax continued to benefit from forex gains to record at Rs11.8Bn for 1H 2023, with a growth exceeding 100% YTD, whilst on a QoQ basis NPAT recorded a decline of 64% to reach Rs3.1Bn for Q2 2023.

The Rupee appreciated against the USD by 5.6% during the quarter resulting in a forex gain for the group. Normalised for the forex gain, a Net Loss was recorded at Rs.0.5Bn for 1H 2023 and Rs0.3Bn for Q2 2023.

Dialog Group continued to be a significant contributor to state revenues, remitting a total of Rs. 21.9 Bn to the Government of Sri Lanka (GoSL) during the first six months of 2023, an increase of 29% YTD.

Total remittances included Direct Taxes and Levies amounting to Rs6.4Bn and Rs15.5Bn in Consumption Taxes collected on behalf of the government. At an entity level, Dialog Axiata PLC (the “Company”) continued to contribute a major share of Group Revenue (52%) and Group EBITDA (63%). Company revenue was recorded at Rs50.4Bn for 1H 2023 up 3% YTD resulting from the growth in data segment.

Accordingly, Company EBITDA was recorded at Rs17.2Bn for 1H 2023 down 10% albeit improving on a QoQ basis by 7% to reach Rs8.8Bn due to traction gained on cost rescaling initiatives.

Dialog Television (“DTV”), continued to consolidate its leadership position in the Digital Pay Television space with the subscriber base being maintained at 1.7Mn as of end 1H 2023. DTV revenue reached Rs6.1Bn for 1H 2023 recording a growth of 9% whilst declining 2% QoQ to record at Rs3 Bn.

Dialog Broadband Networks (“DBN”) featuring the Group’s Fixed Telecommunications, Broadband and International Businesses continued to record strong revenue growth at 44% YTD to reach Rs41.4Bn for 1H 2023 due to growth in wholesale revenue.

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