Dialog Posts 5% Revenue Growth in First Quarter, 28% Increase in Tax Remittances
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09 May 2017. Colombo.
Dialog Axiata PLC announced its consolidated financial results for the three months ended 31 st March
2017. Financial results included those of Dialog Axiata PLC (the ‘Company’) and of the Dialog Axiata
Group (the ‘Group’).
The Group continued its growth momentum across Mobile, Tele-infrastructure and Fixed Line
businesses to record a consolidated Revenue of Rs22.2Bn for Q1 2017, demonstrating a growth of 5%
Year-on-Year (‘YoY’). However, the first Quarter Revenue contracted 3% relative to Q4 2016 as
consumer spending was restrained by increased consumption taxes on communication services
spanning Mobile, Fixed, Broadband and Pay Television. Group EBITDA (Earnings Before Interest, Tax,
Depreciation and Amortisation) for Q1 2017 grew 3% YoY to reach Rs7.2Bn whilst Group EBITDA
contracted 3% Quarter on Quarter (‘QoQ’) on the back of drop in Revenue. The Group EBITDA margin
for the Quarter was recorded at 32.6%.
The Group NPAT (Net Profit after Tax) declined 42% YoY, impacted by increase in depreciation, net
finance cost and forex losses while NPAT demonstrated a growth of 24% QoQ to be recorded at Rs1.5Bn
driven by lower non-cash translational forex losses as the Sri Lankan Rupee depreciated against the
United States Dollar by 1.5% in Q1 2017 compared to 2.2% during Q4 of 2016.
The Dialog Group continued to be a significant contributor to state revenues, remitting a total of
Rs10.5Bn to the Government of Sri Lanka (GoSL) during Q1 2017 representing an increase of 28% YoY.
Total remittances included direct taxes and levies (Rs3.6Bn) as well as consumption taxes collected on
behalf of the GoSL (Rs6.9Bn).
Further endorsing Dialog’s leadership position in Sri Lanka’s fiercely competitive ICT sector, Dialog was
awarded the Telecom Service Provider of the Year for the sixth successive year and the Internet Service
Provider of the Year for the fifth successive year at the SLIM-Nielsen People's Awards 2017 organised by
the Sri Lanka Institute of Marketing (SLIM) and AC Nielsen.
Confidential
Group capital expenditure for Q1 2017 was recorded at Rs4.0Bn representing a capex to revenue ratio
of 18%. Capital expenditure was directed in the main towards investments in High-Speed Broadband
infrastructure aimed at further strengthening the Group's position in Sri Lanka's Broadband sector.
Group Operating Free Cash Flow (OFCF) was recorded at Rs1.4Bn for Q1 2017. The Group continued to
exhibit a structurally robust balance sheet with the Net Debt to EBITDA ratio being maintained at 1.0x as
at end of March 2017.
At an entity level, Dialog Axiata PLC (the ‘Company’) continued to contribute a major share of Group
Revenue (83%) and Group EBITDA (79%). On the back of its Mobile customer base of over 12.2Mn
subscribers, Company Revenue grew 2% YoY to reach Rs18.3Bn for Q1 2017. Company Revenue
contracted 4% QoQ due to restrained consumer spending as alluded to earlier. Company EBITDA
declined 9% YoY to record Rs5.7Bn for Q1 2017 on the back of moderate Revenue growth and increased
cost arising from expansion of network and IT capabilities. In line with performance dynamics at EBITDA
level and forex losses, Company NPAT declined 43% YoY and 12% QoQ to record at Rs1.7Bn.
Dialog Television (DTV) continued to consolidate its leadership position in the Digital Pay Television
space with the subscriber base surpassing 866,000 as at end March 2017. Revenue declined 5% YoY and
1% QoQ to record at Rs1.5Bn for Q1 2017 with subscription Revenue growing 3% YoY, whilst EBITDA was
recorded at Rs65Mn for Q1 2017, increased 108% YoY and contracted 12% QoQ. DTV NPAT recorded a
Net Loss of Rs311Mn for Q1 2017 relative to a Net Loss of Rs182Mn in the corresponding period of
2016.
Dialog Broadband Networks (DBN) recorded Revenue of Rs2.9Bn for Q1 2017, representing an increase
of 39% YoY and 14% QoQ. Downstream of strong Revenue performance, DBN EBITDA for Q1 2017 was
recorded at Rs1.5Bn, representing an increase of 100% YoY and 23% QoQ. On the back of healthy
EBITDA performance, DBN NPAT turned positive to record a Net Profit of Rs237Mn for Q1 2017 relative
to a Net Loss of Rs119Mn in the corresponding period of 2016.
Confidential