Mobile service provider Smart has outperformed its fellow Axiata Group subsidiaries in the first half of the year, according to the Malaysian conglomerate’s latest financial report.
Driven by a 115 per cent increase in data traffic revenue, Axiata’s results show Smart’s gross revenue totalled 270 million ringgit ($85.7 million) at the end of the first six months of the year, up more than 58 per cent compared with the same period last year.
Profits after tax for the local telecom provider reached 47 million ringgit, up 147 per cent year-on-year.
“While certainly the market remains a tough one, characterised by intense competition, we are generally optimistic for the next months to come,” Thomas Hundt, CEO of Smart, said yesterday.
Smart’s subscriber base has reportedly increased to 5.9 million, according to Wednesday’s filing – more than double the local telecom’s subscriber base at the end of 2012.
“To support the growth, to support the continuous inflow of new subscribers and the exponential data traffic demand increase … more than $50 million will be invested into the network and services during 2014, with special focus on building out the data network capacity and reach,” Hundt added.
Of all Axiata’s subsidiary firms, which include Celcom in Malaysia, Dialog in Sri Lanka, XL in Indonesia and Robi in Bangladesh, Smart recorded the largest year-on-year increases in revenue and profits after tax.
Axiata Group, meanwhile, recorded a more modest revenue increase of 2 per cent at the end of the first six months of the year, with exchange-rate fluctuations and new ventures in Indonesia dampening the firm’s overall interim results.
The publicly listed Axiata purchased Smart in February last year for $156 million. As a result, Smart is the only mobile and telecommunications operator in Cambodia whose financial results are made public.
Smart’s interim financial position comes amid heightened tension in the sector over the Ministry of Posts and Telecommunications’ draft telecommunications law, which, if approved, would apply similarly strict financial reporting standards on even privately held telecom firms.
But Sok Puthyvuth, chairman of the newly established Information Communication Technologies Federation, said despite the industry’s reservations towards the law and its reporting demands, financial transparency is needed in the telecom sector.
“Definitely there is a need. This is just one of the reasons for the new telecom law,” he told the Post, adding that the law was still in draft stage and not yet up for National Assembly approval.
“But there are reservations from our members on a few points in the law. But we hope to sort it out with the ministry soon.”