DiGi eyes common IT system

Business & Markets 2013
Written by Charlotte Chong of theedgemalaysia.com
Friday, 10 May 2013 10:05
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KUALA LUMPUR: DIGI.COM BHD [], which is 49% owned by the
Telenor group of Norway, plans to establish a common information
TECHNOLOGY [] (IT) system with the group’s other business units in
Asia and to modernise its billing platform in Malaysia.
It has also announced an allocation of RM750 million in capital
expenditure (capex) this year to improve its telecommunications
network, including launching its 4G long term evolution (LTE) services by
the second quarter of the year.
DiGi CEO Henrik Clausen said by sharing the IT system with Telenor’s
other Asian business units as well as learning from competitors, the
company can improve “the game” in the telecommunications business.
The Telenor group currently has three other telecommunications
companies in Asia, namely Total Access Communication plc (DTAC) in
Thailand, Telenor Pakistan in Pakistan and Grameenphone in
Bangladesh.
Clausen said by cooperating with its other Asian sister companies on
the IT system and modernisation of its billing system, DiGi hoped to
improve its overall operational efficiency and ability to respond to
market needs in the coming years.
On the 2013 capex, he said about 80% of the allocation will be utilised
to expand the company’s existing 3G network as well as to launch the
4G LTE service by the end of June.
Last year, the company allocated RM700 million in capex which resulted in the expansion of its 3G network to more than
67% of populated areas in Malaysia. DiGi currently has a 28% market share with a subscriber base of 10.5 million.
Clausen said the company plans to expand its 3G network to 75% of the country by the year-end.
On the 4G LTE launch, he said DiGi is not concerned over its “late” launch as the 4G LTE “is a 10-year game”. The
company’s two main competitors, Maxis Bhd and Celcom Axiata Bhd, launched their 4G LTE services early this year.
“It is not about the exact timing but about doing it the right way. We will have ample time for what we need to do,” Clausen
told reporters after DiGi’s AGM yesterday.
He said DiGi will also expand its coverage in Sabah and Sarawak as the people there “deserve good [network] services as
much as Peninsular Malaysians do”.
On the company’s revenue trend, Clausen said DiGi expects data revenue to account for an increasing proportion of the
overall service revenue in view of increasing mobile Internet subscribers and smartphone users.
“The data revenue contributions have reached 34% of service revenues in 1QFY13 [first quarter of 2013 financial year], and
this mix is likely to continue throughout the year,” he added.
DiGi posted a net profit of RM1.21 billion for the financial year ended Dec 31, 2012 (FY12) from RM1.25 billion a year earlier.
Revenue increased to RM6.36 billion against RM5.96 billion previously.
For 1QFY13, the company recorded a net profit of RM328.64 million, a marginal growth of 2.5% from the previous
corresponding period. Its revenue stood at RM1.65 billion, an increase of 5.1% from last year’s RM1.57 million.