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Author: PublicInvest   |   Latest post: Thu, 18 Jul 2019, 9:35 AM

 

Astro Malaysia Holding Berhad - Within Expectations

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Astro’s 4QFY19 net profit came in at RM118.4m (-34.9% YoY, -22.7% QOQ) which was primarily dragged by one-off separation scheme cost (RM58m) but mitigated slightly by unrealized forex gain (RM17m). Stripping out these one-off items, the Group’s core 4QFY19 net profit is estimated at RM159.4m which is within our and consensus expectations. Group full year core net profit of RM562.9 (-16.9% YoY) constituted 102% and 97% of our and consensus full year estimates. An interim dividend of 1.5 sen was declared, bringing total dividends of 9 sen declared to date. Maintain Outperform with an unchanged TP of RM2.00.

  • 4QFY19 revenue is steady at RM1.37bn. Group revenue remains steady, underpinned by increased household penetration which improved slightly to 77% (from 75% a year ago) and higher contribution from e-commerce which registered its highest ever quarterly revenue of RM99m. We understand that adex spend is healthy, with the biggest growth of 45% coming from the digital space. Group revenue for FY19 is also stable at RM5.5bn, registering a marginal drop of only 0.9%. EBITDA dipped 12% y-o-y to RM1.6bn while PATAMI dropped 40% y-o-y primarily due to RM463m resulting from higher sports content cost, one-off employee separation scheme costs and unrealized forex losses on finance lease liabilities. We understand that its pay TV ARPU is steady at RM99.90. Astro and NJOI are in 5.7m, or 77% of Malaysian households, garnering TV viewership share of 75%.
  • Key initiatives to drive growth. Astro’s unique bundled broadband with content offering will increase customer engagement, allowing them to enjoy shows on demand via set top boxes as well as through connected devices such as mobile phones and tablets. The group will continue to strengthen its customer value proposition through initiatives such as broadband bundles, seamless viewing across all screens, better customer service and deeper engagement with fans. Leveraging on its content, the Group will deepen its strength in local vernacular and Asian originals through strategic partnerships to address local and regional audience.

Source: PublicInvest Research - 27 Mar 2019

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