• FY 2022 Group Revenue Growth at 26% to record Rs. 178.1 b and Q4 2022 Revenue Growth at 12% QoQ and 37% YoY to record Rs. 51 b
• One off/non-cash provisions and impairments of Rs. 12 b in Q4 2022 and YTD Forex losses amounted to Rs. 30.3 b
• Rs. 35.7 b contributed to GoSL via direct and indirect taxes, fees and levies; up 54% YoY

Dialog Axiata CEO Supun Weerasinghe

Dialog Axiata PLC has ended FY22 with a health revenue growth of 26% but its bottom line was hit by sharp depreciation of the Rupee and other aberrations. It said 4Q took into account the one off/non-cash provisions amounting to Rs. 12.1 billion. These provisions were compelled by the changing business/macroeconomic landscape and the increase in the company’s weighted average cost of capital (WACC) due to elevated market interest rates.

The Group concluded the Financial Year (FY) with positive revenue performance across all business segments, namely, mobile, fixed, digital pay television, international, digital platforms and tele-infrastructure businesses.

Group consolidated revenue was recorded at Rs. 178.1 billion for FY 2022 demonstrating a growth of 26% Year-to-Date (YTD). Group Revenue for Q4 2022 was recorded at Rs. 50.9 billion up 12% Quarter-on-Quarter (QoQ).

However, the operating cost escalations and forex depreciation along with one-off provisions led to Group Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) declining 12% YTD to reach Rs. 51.6 billion for FY 2022 whilst Group EBITDA reached Rs. 10.1 billion for Q4 2022, down 28% QoQ. Normalised for the one-off provision Group EBITDA decline moderated to 5% YTD to reach Rs. 55.8 billion for FY 2022 albeit increasing 2% QoQ to reach Rs. 14.3 billion for Q4 2022.

“The achievement of this performance was underpinned by well-coordinated delivery of innovative and affordable service packs, superior network and customer experience amidst a challenging business atmosphere. It also demonstrates the fruition of cost rescaling and resilience actions taken by the Group,” Dialog said.

The Group Net Profit After Tax (NPAT) recorded a loss of Rs. 33.4 billion for FY 2022 underpinned by lower EBITDA performance, forex losses, higher depreciation and finance cost. Group NPAT for Q4 2022 recorded a loss of Rs. 8.3 billion. Normalised for the one-off provisions, impairment and forex losses, the Group NPAT was recorded at Rs. 9.0 billion for FY 2022, down 54% YTD and Rs. 1.2 billion for Q4 2022 down 35% QoQ.

Dialog said FY22 was one of the most challenging years in Sri Lanka’s recent history marked by social unrest, political uncertainty and an economic crisis. During Q4 2022, key macro indicators stabilised as the Sri Lankan Rupee continued to remain stable (0.4% depreciation in Q4 2022 but depreciated 82.3% YTD 2022) against the United States Dollar (USD) and inflation commenced a declining path to reach 57.2% by year end (from 69.8% by end Q3 2022).

In FY22, Dialog Group continued to be a significant contributor to state revenues, remitting a total of Rs. 35.7 billion to the GoSL during the financial year ended 31 December 2022 and Rs. 9.7 billion for Q4 2022, which represent a 54% increase YTD.

Total remittances included Direct Taxes and Levies amounting to Rs. 13.3 billion and Rs. 22.4 billion in Consumption Taxes collected on behalf of the GoSL.

At an entity level, Dialog Axiata PLC continued to contribute a major share of Group Revenue (57%) and Group EBITDA (69%). Company revenue was recorded at Rs. 101.4 billion for FY 2022 up 11% YTD and Rs. 26.5 billion for Q4 2022 up 2% QoQ driven mainly by Data and Voice segments. 

The company profitability continued to be impacted by the higher network spend due to energy costs resulting from power cuts along with increase in operating costs driven by inflation, LKR depreciation and the one-off provisions as alluded to earlier. EBITDA was recorded at Rs. 35.4 billion for FY 2022 representing a decline of 12% YTD and Rs. 5.9 billion for Q4 2022 down 43% QoQ.

Consequently, company NPAT recorded a loss of Rs. 38.3 billion for FY 2022 and a loss of Rs. 18.1 billion for Q4 2022.

Dialog Television (DTV), continued to consolidate its leadership position in the Digital Pay Television space with a strong subscriber base of 1.7 million for the year ended 31 December 2022. DTV revenue recorded a strong growth of 14% YTD to reach at Rs. 12 billion for FY 2022. However due to cost escalations from LKR deprecation, DTV EBITDA declined 57% YTD to reach Rs. 1.6 billion for FY 2022. Consequently, DTV Net Loss increased to Rs. 4.2 billion for FY 2022.

Dialog Broadband Networks (DBN) featuring the Group’s Fixed Telecommunications, Broadband and International Businesses recorded revenue of Rs. 68.8 billion for FY 2022 up 54% YTD resulting from increase in International Wholesale and Fixed Broadband Revenue. DBN EBITDA recorded a growth of 2% to reach Rs. 14.8 billion for FY 2022. NPAT was recorded at Rs. 3.3 billion for FY 2022.

 

Dialog investments in FY20 hit a new high of Rs. 52 b