Astro 4Q profit falls 24% to RM126 mil, pays 2.25 sen dividend

KUALA LUMPUR (March 31): Astro Malaysia Holdings Bhd’s net profit for the financial year ended Jan 31, 2022 (4QFY22) fell 24.57% to RM126.59 million from RM167.83 million a year ago, due to higher license, copyright and royalty fees, staff related and financing costs.

Its revenue for 4QFY22 also slipped 6.98% to RM1.03 billion from RM1.11 billion a year ago, due to a decrease in subscription and merchandise sales, the company said in a bourse filing.

Quarterly earnings per share fell to 2.43 sen, from 3.22 sen in 4QFY21.

The group declared a fourth interim dividend of 1.5 sen per share and proposed a final dividend of 0.75 sen per share for 4QFY22, bringing its total dividend for the full-year ended Dec 31, 2022 (FY22) to 6.75 sen per share, from 8 sen in FY21.

In 4QFY22, earnings before interest, tax, depreciation and amortisation (EBITDA) margin decreased by 3.5% against 4QFY21, mainly due to higher licence, copyright and royalty fees, and staff related costs, mitigated by lower merchandise costs, as a percentage of revenue.

Revenue continues to be impacted by the Covid-19 pandemic, and saw a decrease in subscription and merchandise sales, offset by an increase in advertising revenue, Astro said.

Quarter-on-quarter (q-o-q) however, Astro’s net profit rose 19.51% to RM126.59 million from RM105.92 million on improved margins and lower depreciation of right-of-use assets, offset by higher finance costs and tax expense. Revenue rose 0.87% q-o-q to RM1.03 billion from RM1.02 billion, as higher advertising revenue offset lower subscription revenue and merchandising sales.

On a year-on-year basis, revenue for the television segment for 4QFY22 was lower by 4.7% to RM907.9 million from a year ago, mainly due to a decrease in subscription revenue, offset by an increase in sales of programming rights and advertising revenue.

Its television EBITDA decreased by 21.8% against the corresponding quarter on a decrease in revenue, higher licence, copyright and royalty fees, broadband cost, and marketing and distribution expenses.

Meanwhile, its home-shopping revenue for 4QFY22 reduced by 39.5% to close at RM66.9 million from a year earlier, primarily due to subdued consumer sentiment, more cautious spending and floods affecting sales and delivery.

In addition, the easing up of restrictions imposed by Movement Control Order resulted in customers frequenting physical stores following months of restrictions, it added.

For FY22, Astro’s net profit declined by 14.63% to RM460.88 million or 8.84 sen per share from RM539.85 million or 10.35 sen per share a year earlier, while its revenue decreased by 4.22% to RM4.18 billion, from RM4.36 billion.

Becoming an internet service provider

Moving forward to FY23, Astro chief executive officer Henry Tan said the group is powering up by becoming an internet service provider, bundling Astro Fibre with content, introducing Astro Fibre standalone broadband to complement its suite of offerings, as well as the full-scale rollout of our addressable advertising proposition.

“The group continues to invest in its transformation plans, in particular content, broadband, streaming, customer experience, data, addressable advertising and technology infrastructure, to simplify our processes and most importantly to better serve our customers,” he said in a statement.

On anti-piracy efforts in Malaysia, the passing of the Copyright (Amendment) Act 2022 is another major step forward, enabling legal action to be taken against sellers of Illegal Streaming Devices (ISD), Tan said.

The group remains cautiously optimistic and will continue to monitor business conditions, whilst prudently managing costs, he added.

Astro closed two sen or 1.85% higher at RM1.10 on Thursday (March 31), valuing the group at RM5.63 billion. Year-to-date, the counter has gained 15.79%.