14 th Annual General Meeting 27 June 2011

Transcription

1 14 th Annual General Meeting 27 June 2011

2 HELLO. I m AFZAL. I work for TIME.

3 2010 Q Expectations MSWG Questions

4 2010 at a glance WHOLESALE CORPORATE & GOVERNMENT SME & CONSUMER SELECTIVELY EXPANDING COVERAGE MOBILE NODE FIBERISATION FIBRE INTERNET PRODUCTS NETWORK IMPROVEMENTS CULTURAL TRANSFORMATION 4

5 Performance Indicators

6 2010 Performance 6

7 Revenue +12% yoy RM321 mil RM287 mil

8 EBITDA and EBITDA Margin up yoy +38%EBITDA +5% RM87 mil EBITDA Margin RM63 mil* 22% 27% *Excluding loss on disposal of quoted investment, voluntary separation scheme and other compensation cost.

9 Operating Profit and Operating Margin up yoy +130%Ops Profit +6% RM36 mil Ops Profit Margin 11% RM16 mil* 5% *Excluding loss on disposal of quoted investment, voluntary separation scheme and other compensation cost.

10 Profit Before Tax +169% yoy RM89 mil RM33 mil

11 Revenue by Product Data 74% Voice 24% +33% Growth YoY YoY Decline -14%

12 Q Performance 12

13 Revenue +8% yoy RM70 mil RM65 mil Q1, 2010 Q1, 2011

14 EBITDA and EBITDA Margin up yoy +8% EBITDA Margin +43% EBITDA RM23 mil 32% RM16 mil 24% Q1, 2010 Q1, 2011 Q1, 2010 Q1, 2011

15 Operating Profit and Operating Margin up yoy +217%Ops Profit +9%Ops Profit Margin RM9.5 mil 5% 14% RM3 mil Q1, 2010 Q1, 2011 Q1, 2010 Q1, 2011

16 Profit Before Tax +22% yoy RM23 mil RM19 mil Q1, 2010 Q1, 2011

17 2011 Expectations 17

18 Sustaining and improving financial performance Strong drive for data revenues ASTRO IPTV roll-out Target completion of acquisitions by end 2011 Integration of acquiree businesses Geared for regional play in 2012

19 MSWG Questions

20 Operational & Financial Performance

21 Q1(a) Why is the global bandwidth contract non-recurring given its lucrative margin as noted between the sale value and cost incurred? A. The Global bandwidth business is an interesting and growing area we introduced in 2010 in to our business. Contracts in this may be either one time or recurring in nature (as defined in the Bursa Listing Requirements) depending on customer demand. Such contracts may take the form of Indefeasible Right of Use ( IRU ) which are sale/ grant of the right of use of specific telecommunication capacity or bandwidth for a contracted period of time. The Group however, does not expect linear or consistent contributions from this area of business.

22 Q1(b) What is the rationale for the payment terms of the global bandwidth business, a related party transaction of RM46.5 million (2009:Nil) to be over a period of up to three (3) years and who is the Director involved? A. Global bandwidth sales include IRUs which typically involve payments to be made over a period of a few years after the sale has taken place not unlike a finance lease of an asset. In our Group, such transactions are usually paid over a period of between 1 to 3 years although the contract period may be longer. The related party transaction involves IRU sales to Global Transit Communications Sdn Bhd, which is also a regional wholesale bandwidth provider. Afzal Abdul Rahim, Megat Hisham Hassan and Elakumari Kantilal are interested related parties via Pulau Kapas Ventures Sdn Bhd ( PKV ) while Abdul Kadir Md Kassim is an interested related party via UEM Group Bhd. Both PKV and UEM Group Bhd are major shareholders of TIME.

23 Q1(c) What is the reason for the allowance for doubtful debts in relation to outstanding balance due from other related parties to increase to RM1.60 million in 2010 from RM145,000 in 2009? A. The increase in allowance for doubtful debts is in line with the Group s increase in revenue and policy of provisions for debts outstanding for more than 1 year unless there is objective evidence to show otherwise. The allowance for doubtful debts due from related parties were mainly for companies in the UEM Group and Telekom Malaysia Berhad. Notwithstanding this, the Group will continue to endeavour to recover all amounts provided for as doubtful debts.

24 Q1(d) What could be the Group s capital expenditure for 2011 and the medium term given that the Group has planned to reach 167,000 homes by the end of the year? A. In 2011, our CAPEX focus will revolve around our expansion plans for our Astro collaboration into new consumer buildings, fiberizing nodes for our wholesale customers and selected coverage expansion for our business customers. With these expansion activities, we expect our CAPEX to increase accordingly.

25 Q1(e) How does the Board assess the competition from Telekom Malaysia s High Speed Broadband (HSBB) given that the HSBB had reached 760,000 premises since last year and also entered into strategic collaboration with Maxis and Celcom? A. Our Board is of the opinion that TM s HSBB roll out is an encouraging initiative to educate the consumer segment towards adopting high speed broadband and in setting price acceptance levels. We believe the scale of the TM s initiative will benefit the telecommunications industry in general by introducing new product lines which we can then compete in terms of service quality and product innovation. In this area, our strategy is to deliver via innovative product packaging via our collaboration with ASTRO to introduce bundled Pay TV products with TIME s Internet and Voice products. To this end, the collaboration will allow us to leverage on ASTRO s established consumer branding, marketing and customer servicing abilities whilst TIME focuses on delivering quality broadband services and supporting ASTRO as a strategic partner. In 2010, the Company signed a milestone agreement with DiGi to support in meeting their data growth requirements. We expect more joint efforts towards infrastructure cost efficiencies.

26 Q2) On 25 April 2011, the Company participated in a 24-member Konsortium Rangkaian Serantau Sdn Bhd (KRS) under the National Key Economic Area. The KRS is to bring down the cost of Internet Protocol (IP) transit by buying international bandwidth in bulk and to be partners of submarine cable networks that reach the US and the European shores. How does the Board assess the impact of the KRS consortium against its wholesale business in the medium to long term? A. KRS is a positive national initiative and we expect our participation to bring significant benefits to TIME and to the industry. More particularly, we see KRS benefiting us in two key areas: i) potentially better terms for the Group s internet access; and ii) opportunity for TIME to work with other consortium partners in sourcing and supplying international bandwidth as a business

27 Q3) On 15 November 2010, the Company announced a series of corporate exercises pertaining to capital repayment, capital restructuring, acquisitions and exemption (the Proposals). The Proposal is subject to shareholders approval and scheduled for completion in mid What are the reasons for the longer time taken for the Proposals to be concluded? A. We have submitted our draft circular to Bursa Malaysia on 30 March 2011 and received their comments on 9 June 2011 (which included their approval for the proposed share consolidation and listing and quotation of new shares pursuant to the Proposed Acquisitions subject to certain conditions). Issuance of the circular will depend on the timing of Bursa s clearance of its contents. Completion of the Proposed Corporate Exercise is therefore subject to the timing of approvals by the regulators.

28 Corporate Governance Matters

29 Q4) We note that the Board had identified a Senior Independent Non-Executive Director (INED) to whom concerns may be conveyed. We would encourage the Board to provide the contract details of the Senior INED for stakeholders to raise their concerns and queries. A. We have since published Mr Ronnie Kok s contact details in our website.

30 Q5) We encourage the Board to disclose Directors remuneration by individual Directors for transparency purposes. A. Our disclosure is in compliance of Bursa s listing requirements. However, the Board will take due consideration of MSWG s comments for the future.

31 Q6) It is also encouraged that the Board establishes a dividend policy and discloses it in the Annual Report in line with good practice. A. The Board notes the comments and will give the matter due consideration. However, it is also important to understand that TIME is currently in its growth and expansion phase and will require funds to execute its plans.

32 Disclaimer This presentation and the discussion following may contain forward looking statements by TIME dotcom Berhad ( TIME ) related to financial, market or industry trends for future period. These forward looking statements involve known and unknown risks and uncertainties which may cause the actual performance, results and outcome to be different than that expressed in this presentation. The statements are made based on facts and information available to TIME at the date of the presentation and merely represent an expression of TIME management s views, targets and expirations of future events. They do not in anyway represent a forecast, projection, estimate or guarantee of TIME s future performance and neither have they been independently verified. Accordingly no representation or warranty, express or implied is made to, and no reliance should be placed on the fairness, accuracy and completeness of such information. TIME and its subsidiaries, representatives and officers shall have no liability whatsoever for any loss, damage, costs and expenses arising out of or in connection with this presentation.

33 Thank You Should you have any queries, please contact:: Karen Ding Head of Planning & Investor Relations TIME dotcom Berhad No.14, Jalan Majistret U1/26, Hicom Glenmarie Industrial Park, Shah Alam, Selangor, MALAYSIA Tel: I Fax: I