dtac’s 9-month EBITDA margin reaches 46.8% driven by strong momentum on cost optimization and rigorous financial discipline
16 October 2020 – In Q320, dtac continued to focus on operational efficiency through ongoing optimization and digital transformation initiatives while following customer-centric approach in delivering relevant products and services to the mass Thai market.
Sharad Mehrotra, dtac’s Chief Executive Officer, Total Access Communication PLC. or dtac said “We are pleased to see the continuation of strong digital adoption post-lockdown. Similar to how many businesses reshaped their way of work on a long-term basis, dtac is progressing with initiatives to continuously deliver digital enhancement on the customer front and internally. With strong momentum on digital transformation, we also continue to improve our operational efficiency to be well-positioned going into the pandemic-driven prolonged uncertainty.
To lesson customer pressure from the extended economic impact, dtac sticks to our customer-centric position through offering relevant products and services that serve the demand for basic necessities of each customer group. While we observed increase in spending optimization across customer segments, we enabled strategic partnerships across business sectors to ensure greater accessibility for full redemption of benefits and offers by the mass Thai market. And to address the business segments pain-points, we launched dtac Business consisting of worry-free and simplified solutions covering sims, IoT, and cloud solutions while incorporating digital service channels. With network improvement plan ramped up as targeted, we are confident in our promise to continuously deliver stable connectivity for all.”
At the end of Q320, total subscriber base stood at 18.7 million with a substantial reduction in subscriber loss to 107k QoQ. The subscriber loss is due to slow recovery and aggressive competition. Service revenues excluding IC for Q320 dropped 1.7% QoQ and 7.6% YoY while core service revenues reduced 1.4% QoQ and 5.3% YoY. EBITDA for Q320 declined 4.3% QoQ and 3.0% YoY from soft revenue development. Despite top-line uncertainty, dtac’s 9-month EBITDA margin (normalized) at 46.8% was higher than pre-COVID-19 level as a result of ongoing efficiency improvement. Net profit for Q320 amounted to THB 1.4 billion.
Dilip Pal, dtac’s Chief Financial Officer, Total Access Communication PLC. or dtac said “Despite uncertainty and evolving market conditions affecting top line growth, we are certain about our disciplined financial approach. With yet another quarter-long of zero tourist, we focused on providing connectivity for the mass Thai market while optimizing our operations for improved efficiency. Together with our digital transformation journey, we are well-placed to capture long-term sustainable earnings growth.
dtac revised guidance for 2020 on service revenue excluding IC from low-single digit decline to mid-single digit decline, while maintaining the rest which are EBITDA at 2019 level and capital expenditure of THB 8-10 billion.
Key financial indicators in Q320
Service revenue excluding IC – THB 14.4 billion, declining 1.7% QoQ and 7.6% YoY