Dialog bullish on IT, IT-related start-ups
View(s):Dialog Axiata PLC is bullish on IT related businesses and has signed a few MoUs with firms in this area they aim to work with, industry sources said.
The Dialog Axiata Group which saw a growth momentum across mobile, tele-infrastructure and fixed line businesses to record consolidated revenue of Rs. 22.2 billion for Q1 2017, which is a growth of 5 per cent Year-on-Year (‘YoY’) is keen to acquire IT related businesses, they said.
“They are also interested in bringing local start-ups under their fold,” a source told the Business Times.
Analysts said that Dialog Axiata PLC, the group’s mobile arm will show revenue through data, which has already taken over their Short Messaging Services (SMS) and IDD revenue, and currently is in the process of disrupting voice revenue.
The Group NPAT (Net Profit after Tax) declined 42 per cent YoY, impacted by increase in depreciation, net finance cost and forex losses while NPAT demonstrated a growth of 24 per cent quarter on quarter to be recorded at Rs. 1.5 billion driven by lower non-cash translational forex losses as the Sri Lankan Rupee depreciated against the US dollar by 1.5 per cent in Q1 2017 compared to 2.2 per cent during Q4 of 2016.
As a result of Dialog’s finance expenses surge with rising interest bearing borrowings, its net finance expenses increased 175 per cent YoY to Rs. 892 million, while the majority of the impact was caused by disadvantageous forex fluctuations on USD denominated loans.
Capital expenditure for the quarter which saw an 18 per cent increase at Rs. 4 billion was directed in the main towards investments in High-Speed Broadband infrastructure aimed at further strengthening the Group’s position in the Broadband sector.
Dialog’s top line saw a growth of 5 per cent YoY to Rs. 22.16 billion where 82 per cent of the total was accounted by mobile operations, which grew at a slower 3 per cent YoY to Rs. 18.2 despite a 15 per cent YoY growth in the subscriber base (10.6 million to 12.2 million).