Astro posts RM146m net profit in Q3

PETALING JAYA: Astro Malaysia Holdings Bhd, which today entered into a binding term sheet with Grup Majalah Karangkraf Sdn Bhd (GMK) to form a joint venture (JV), saw its net profit for the third quarter ended Oct 31, 2017 fall 2.9% to RM146.68 million from RM151 million a year ago.
This is because of the decrease in earnings before interest, tax, depreciation and amortisation (ebitda), in which its ebitda margin decreased 3% due to higher license, copyright and royalty fees, higher selling and distribution expenses and higher telecommunication cost.
Revenue was lower by 1.9% to RM1.4 billion against last year’s corresponding quarter of RM1.42 billion, mainly due to lower subscription, advertising and licensing revenue.
The group has proposed to declare an interim dividend of 3 sen per share.
For the nine months period, its net profit increased 23% to RM588.85 million from RM478.61 million a year ago. Revenue for the current period of RM4.14 billion was lower by 1.7% against the corresponding period of RM4.22 billion.
Astro is cautiously optimistic for the rest of the financial year, despite relatively subdued consumer sentiment.
Group CEO Datuk Rohana Rozhan said regionally the group will forge complementary win-win partnerships, as well as identify strategic and opportunistic investments for its growth portfolio.
On the partnership with GMK, Astro said it will invest RM100 million for a 51% stake in Karangkraf Digital 360 Sdn Bhd.
The JV would extend Astro’s online presence amongst the Malay-language audience, propel its combined monthly unique visitors to 10 million and is in line with its goal to build Nusantara and Islamic content verticals.
The JV aims to pursue 360° monetisation strategies for Karangkraf Digital’s content intellectual properties across multiple platforms, leveraging on Astro’s capabilities, growing reach and engagement.
Astro’s share price today closed 1.06% lower at RM2.80 with 5.35 million shares traded.