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CELCOMDIGI BERHAD 1Q 2025 Earnings Call 22 May 2025 | Kuala Lumpur
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Disclaimer This presentation and the following discussion by CelcomDigi Berhad (“CelcomDigi”) may contain forward- looking statements related to financial trends for future periods, compared to the results for previous periods characterised by the use of words and phrases such as “might”, “forecast”, “anticipated”, “project”, “may”, “believe”, “predict”, “expect”, “continue”, “will”, “estimate”, “target” and other similar expressions. Forward-looking statements are based on management’s current views and assumptions including, but not limited to, prevailing economic and market conditions. It involves known and unknown risks, uncertainties and other factors which may cause actual performance, outcomes and results to differ materially from those expressed or implied in such forward-looking statements. Such forward-looking statements are not a guarantee of future performance. This presentation does not constitute an offer or invitation or any solicitation of any offer to subscribe for or purchase any securities and nothing contained herein shall form the basis of any contract or commitment whatsoever. No reliance may be placed for any purposes whatsoever on the information contained in the presentation or on its completeness, accuracy or fairness. None of CelcomDigi nor any of its shareholders, directors, officers or employees nor any other person accepts any liability whatsoever for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection therewith.
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Datuk Idham Chief Executive Officer Albern Murty Deputy Chief Executive Officer Dennis Chia Chief Financial Officer Presented By
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Key Highlights Operational & Market Updates Financial Review Focus & Guidance Q&A
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Financial performance within expectations Growth in Total Revenue and Profit After Tax year-on-year1 Growth across key core segments and subscriber base Continued growth in key segments of Postpaid, Home & Fibre and Enterprise, while managing market challenges on Prepaid2 Integration and transformation progressing well Investments now delivering enhanced quality and experience for customers, moving into next phase of transformation initiatives 3 Synergy realisation on track Tracking well towards cost savings of RM700~RM800 million annually post-20274 Executive summary Good momentum into 2025
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Performance highlights 1Q 2025 PAT RM388m 139.5% Q-Q 4.6% Y-Y CAPEX RM148m 4.6% CAPEX Intensity Declared first interim dividend per share of 3.7 sen EBIT Service Revenue RM2,655m 2.4% Q-Q 1.2% Y-Y RM3,209m Total Revenue 1.2% Y-Y 2.0% Q-Q 20,655k Total Subscribers 261k Q-Q 190k Y-Y EBIT RM696m 118.9% Q-Q 21.3% Y-Y
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Investing for the Future • Use cases AI on going AI in Customer Care, Automation, FMC, and Network Infra • New agency services API-as-a-service • Future talent Young Talent Programme Driving Operational Excellence • EBI • Productivity 1.8x revenue per store post- transformation • Subs acquisition 10.6% cost Y-Y • Sites productivity >40% more efficient • Total sites reduction Enhancing Customer Experience • Increase throughput & consumption per user >84Mbps per user ~35GB per user • Retail experience 97% CSAT • Call centre 67% CSAT Strengthening Market Leadership • Core segments Postpaid & Prepaid subs growth • Convergence 2x growth Y-Y • Value-Added Services Double-digit growth Y-Y Integration and transformation initiatives and synergy savings on track Key Highlights Progress in creating pathways for sustained profitable growth Future Use cases AI on going New agency services service etc. Future talent 722 cust/site – before NIC
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Operational and Market Updates
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Postpaid & Convergence Progress in key target growth segments while minimising impact of market challenges Home & Fibre Enterprise Business Strengthened subscriber base with higher-value plans, and increased contracted users Grew subscriber base through strong convergence uptake, higher-speed plan adoption, and sustained FWA momentum Continue to attract enterprises through connectivity, ICT and cyber security solutions
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Consumer Mobile – Postpaid Strategic Postpaid shift growing high-value base Revenue ARPU RM60 Q-Q 0.3% Y-Y 3.2% Subs (‘000) 5,499 5,618 5,710 5,793 5,839 1Q24 2Q24 3Q24 4Q24 1Q25 • Contracted base grew by >250K YoY, increasing contracted rate to >50% (+4pp YoY), driven by strong adoption of value-accretive plans • Long-term strategy to convert Prepaid to Postpaid, which supports ARPA growth, convergence, and base stickiness
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Consumer Mobile – Prepaid Prepaid remains stable with rising Mobile Internet (MI) adoptions Revenue ARPU RM27 Q-Q 2.9% Y-Y 5.7% Subs (‘000) 1Q24 2Q24 3Q24 4Q24 1Q25 • Prepaid revenue decline mainly driven by seasonality (2 fewer business days); normalised trend remains stable to positive • Monthly MI user base rose from 65% to 70%, with subscriber base stabilising, indicating shift towards higher-value, data-centric user 13,322 12,944 12,839 12,862 12,975
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Home & Fibre Subscriber growth sustained by convergence and high-speed demand Revenue ARPU RM96 Q-Q 1.9% Y-Y 48.1% Subs (‘000) 124 141 160 187 205 1Q24 2Q24 3Q24 4Q24 1Q25 • Sustained subscriber growth for six consecutive quarters, led by CelcomDigi One plans driving ~2x YoY convergence growth and contributing to 33% of Fibre/FWA acquisitions • Strong demand for high-speed and instant connectivity, with 33% of new subs on 500Mbps+ plans and FWA growing 3x YoY
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Enterprise Growth in Enterprise Mobile and Solutions Enterprise Mobile* Y-Y 0.2% Q-Q 3.8% • Lower Mobile revenue driven by a one-off waivers for renewals and seasonality usage impact • Continued growth in focus area of connectivity, ICT and cyber security solutions • Continue winning large deals in Enterprise solutions Enterprise Solutions* Y-Y 13.8% Q-Q 7.4% *Normalised for one-off: RM4.9m for mobile, RM16m for solutions
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Financial Review
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1Q25: Financial topline snapshot Resilient quarter with stable core and PAT growth despite one-offs RM’mn 1Q25 4Q24 1Q24 Q-Q Y-Y Total Revenue 3,209 3,276 3,171 -2.0% 1.2% Service Revenue 2,655 2,720 2,688 -2.4% -1.2% EBIT Normalised EBIT 696 758 328 658 574 713 112.2% 15.2% 21.3% 6.3% PAT Normalised PAT 388 434 161 409 371 475 140.9% 6.1% 4.6% -8.6% CAPEX 148 1,152 318 -87.2% -53.5% Subscriber base (K) 20,655 20,394 20,465 261 190 • Q1‘25 result is commendable with positive Y-Y and on target performance for both total revenue and PAT • Service revenue overall growth was moderated by a strategic shift away from one-time Prepaid SIM acquisitions and timing of revenue recognition for solution-related services • Total costs rose due to higher device and traffic costs from strong sales and data usage, partially offset by lower staff costs from a Q1 2024 voluntary separation scheme • EBIT remains relatively stable YY cushioned by lower Opex; and PAT improved Q-Q, Y-Y and within target from lower Depreciation & Amortization Notes: • • • •
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1Q25: Cost and expense Disciplined cost management with normalising non-recurring items RM’m 1Q25 4Q24 1Q24 Q-Q Y-Y Cost of goods sold 853 814 749 4.8% 13.9% Sales & marketing 171 165 170 3.6% 0.6% Staff costs 249 135 354 84.4% -29.7% Operations & maintenance 228 246 222 -7.3% 2.7% Other operating expenses 360 369 329 -2.4% 9.4% Total Cost 1,861 1,729 1,824 7.6% 2.0% Depreciation & amortization 654 888 769 -26.4% -15.0% Others 2 332 4 -99.4% -50.0% Total Expenses 2,517 2,949 2,597 -14.6% -3.1% 2,597 2,949 2,517 1Q24 4Q24 1Q25 -3.1% -14.6% Total Expense (RM’mn)
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Strong commitment to shareholders First interim dividend of 3.7sens per share Capex 318 148 10.0% 1Q24 4.6% 1Q25 Intensity CAPEX (RM’m) Net Debt /EBITDA (x) Free Cashflow (RM’m) Dividend per share (sen) Dividend (RM’m) 283 515 -94 472 -411 -411 -422 -434 -434 52 Payment date 30/6/2025 3.5 3.5 3.6 3.7 3.7 2.1 2.1 2.2 2.2 2.1 1Q24 2Q24 3Q24 4Q24 1Q25
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Advancing into year three of integration ~RM1.6b net synergies unlocked, with 5-year steady-state savings and NPV synergies of RM8b to RM10b P&L SAVINGS CAPEX AVOIDANCE INTEGRATION COST NET SYNERGIES On track to achieving 2027 expectations: Steady-state savings ~RM700m to ~RM800m 157 209 (119) 247 FY23 NPV Synergies ~RM8b to ~RM10b 345 1,380 (385) 1,340 20 46 (63) 3 FY24 1Q25(RM’m) 522 1,635 (567) 1,590 TOTAL (as at 1Q25)
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2025 Focus & Guidance
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Market opportunities and challenges Leverage execution and transformation momentum to drive profitable growth, trust and customer excellence • Continue postpaid and convergence momentum • 5G Uptake on Value-Added Services • Increase in loyalty through stickiness and value proposition • Monetisation of Enterprise solutions • Regulatory pressure • Macro-economics • Heightened competition Opportunities Risks
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2025 Guidance Progressing in line with guidance Low single digit growth Low to mid single digit growth CAPEX Intensity 14% - 16% EBIT* Service Revenue *Excluding material non-recurring and extraordinary items for both FY2024 and FY2025
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Q&A
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CelcomDigi Berhad Registration No: 199701009694 (425190-X) Thank You Thursday, 22 May 2025