Proton to offer YES in-car 4G Internet access

Proton Holdings and Yes, a 4G network provider under YTL Communications Sdn Bhd, today launched a collaboration to offer Malaysia's first in-car 4G internet access in Proton's high-end cars and the new sedan P3-21A to be launched next month.

In the partnership, Proton customers will enjoy 4G connectivity as a new value-added standard feature which will tap into Yes' 4G mobile internet network that currently covers over 65 per cent of the country's populated area.

Proton Group managing director Datuk Seri Haji Syed Zainal Abidin Syed Mohamed Tahir said this innovation, the first endeavour in Proton's rebranding exercise, opens a new spectrum of possibilities and offers customers speed, mobility, comfort and greater productivity while on the road.

"We have been working with YTL for about a year and signed an agreement last year. Today is one small step. Following this, we are trying to work together to integrate more features embedded in the car," he told reporters after the launching ceremony.

He said this initiative would make the Proton brand much more attractive and add income to the company. The cost impact of the new Proton 4G internet car would be very minimal to its customers as providing quality and affordable cars is the objective, Syed Zainal said adding that Proton has negotiated a good package with YTL.

Yes is the only wireless network operator in Malaysia to offer seamless 4G connectivity along the full 960 km stretch of the North-South Expressway and a large portion of the East-Coast Expressway.

Up to five mobile devices can be connected to the car's micro wireless network at any one time. -- Bernama



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Yeoh expects YTL Comms to turn around

KUALA LUMPUR: YTL Power International Bhd expects its subsidiary YTL Communications Sdn Bhd to turn around within two years, managing director Tan Sri Francis Yeoh told shareholders at the company’s annual general meeting here yesterday.

A 60% subsidiary of YTL Power, YTL Communications launched its YES 4G wireless network in November last year.

“He [Yeoh] told shareholders to be patient and think that YTL Communications will turn around to become an aggressive and profitable company within two years,” said a shareholder at the AGM.

For its 1QFY12 ending Sept 30, YTL Power’s mobile broadband network division posted a loss before tax of RM94.94 million. For its FY11 ending June 30, the division posted a loss before tax of RM280.2 million on the back of RM26.6 million in revenue.

YTL Power’s net profit for FY11 increased by 11.3% to RM1.346 billion from RM1.209 billion a year ago, on the back of a 9.1% increase in revenue to RM14.663 billion from RM13.443 billion a year ago.

Yeoh said YES now has a subscriber base of over 3,000 and YTL Communications will break even when it has one million subscribers, according to the shareholder.

Yeoh told shareholders that YTL Communications will launch an Android smartphone together with an “easy to understand” price plan in January next year. The Android smartphone will be sold at half the price of an iPhone.

However, shareholders at the AGM were disappointed with YTL Power’s dividends for FY11.

YTL Power paid dividends amounting to 9.39 sen for FY11 compared with 13.13 sen for FY10, a reduction of about 29%.

“Francis [Yeoh] said the company paid less dividends compared to last year because it is preserving cash for a huge credit crunch which he [Yeoh] believes will happen in the coming year or two,” said the shareholder.

The shareholder said Yeoh believes this “huge and wild” financial turbulence will last for a year or two.

“Yeoh said he is preparing YTL Power for good growth after the ‘turbulence’ as there will be better opportunities if a company is in a good cash position,” added the shareholder.

As of end-September, YTL Power had cash reserves of RM8.155 billion against borrowings of RM15.644 billion.


This article appeared in The Edge Financial Daily, November 30, 2011.



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Telcos facing faster decline from voice

KUALA LUMPUR: While Maxis Bhd and Axiata Group Bhd have yet to announce third quarter (3Q) earnings, analysts reckon numbers will show data revenue gaining prominence over the money made from traditional voice services.

“The third quarter is very much a seasonal quarter as a result of the number of public holidays during the period. However, the main trend that is being seen so far is that revenue from voice continues to decline. Although this is expected, the rate at which the decline is occurring is faster than expected,” said an analyst.

As more of the telco revenue comes from data, the need for more spectrum and capital expenditure to upgrade infrastructure would become more pressing.

Maxis is expected to see some margin pressure as revenue from its voice segment continues to decline.

“This means that the government may come under pressure to announce the award of more spectrum to the players, more specifically the LTE/4G spectrum, soon.

Originally, the award was expected to come at the end of October, however now most are predicting it to happen during the first half of next year,” said an industry observer.

At the moment, the exact allocation of the 180 MHz LTE/4G spectrum is still up in the air as lobbying from industry players intensifies.

To recap, the nine companies that are in the running for the spectrum are Celcom Axiata Bhd, Maxis Broadband Sdn Bhd, DiGi Telecommunications Sdn Bhd, U-Mobile Sdn Bhd, Asiaspace Sdn Bhd, Packet One Networks (M) Sdn Bhd (P1), REDtone Marketing Sdn Bhd, YTL Communications Sdn Bhd and Puncak Semangat Sdn Bhd.

Although the LTE/4G spectrum will only be available for use from 2013 onwards, given the sensitivity of the subject, most of the telcos are adopting a “wait and see” approach before making a firm commitment on the matter.

This need for data has also sped up the trend of collaboration between the players with several partnerships taking place this year such as the network collaboration agreement between Celcom and DiGi. More recently, Maxis entered into an active 3G radio access network sharing agreement with U Mobile.

One of the first companies to launch a LTE/4G trial was Maxis, which successfully concluded a test during the middle of last year. For its upcoming 3Q results, analysts are expecting the numbers to fall within expectations, but there is a possibility that revenue from its voice could see a sharper-than-anticipated drop.

“Maxis is expected to see some margin pressure as revenue from its voice segment continues to decline. The company has been seen as having lost some of its postpaid market share to its competitors DiGi.Com and Celcom Axiata,” said an analyst.

While Maxis expects to see some contribution from its newly launched home broadband segment towards the end of the year, analysts are expecting the portion to still be small given its slightly later-than-expected rollout. To clarify, Maxis entered the home broadband business when it signed an agreement with Telekom Malaysia Bhd to ride on the latter’s high-speed broadband backbone.

“The segment is still only expected to contribute within the medium term,” said the analyst. However, analysts are also expecting Maxis’ upcoming results to show a greater proportion of its revenue to come from non-voice related segments, close to 50%, which is the highest in the industry.

Axiata’s results would largely depend on how well its unit Celcom performed during the quarter. This is given that its other big earnings contributor, Indonesian PT XL Axiata Tbk, had announced flattish 3Q numbers due to increased spending to boost its data network.


This article appeared in The Edge Financial Daily, November 29, 2011.



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YTL 1Q profit down on mobile broadband losses

PETALING JAYA: A RM94.9 million loss from YES mobile broadband business caused YTL Corp Bhd’s earnings for 1Q ended Sept 30, 2011 to decline 9.7% year-on-year (y-o-y). Profit attributed to shareholders came in at RM251.83 million from RM278.9 million after taking in smaller numbers from YTL Power International Bhd.

“This is not unexpected, given the nature of the business and the front-loaded capital outlay required to build our nationwide network,” group managing director Tan Sri Francis Yeoh said in a statement, adding that the business would turn in profit once scale is attained.

Revenue rose marginally to RM4.54 billion from RM4.41 billion, even though performance at cement processing and other utility divisions held up well.

The group said it is in the final stage of ongoing rationalisation of its retail and hospitality division with the acquisitions by Starhill Real Estate Investment Trust (Starhill REIT) of its eight hotels, including the Ritz-Carlton Kuala Lumpur, the Vistana chain of hotels, as well as the Pangkor Laut, Tanjong Jara and Cameron Highlands luxury resorts.

“Internationally, the trust is in the process of completing its acquisition of Hilton Niseko in Japan. In addition, the group completed the restructuring of its property development business on Nov 4,” he said.

Yeoh says the loss from YES is not unexpected due to the heavy capital outlay needed to build a nationwide network.

YTL Power’s net profit fell to RM246.2 million for the quarter compared with RM272.9 million last year. Revenue, however, grew by 4.4% to RM3.64 billion from RM3.48 billion, mainly due to better performance of its merchant multi-utility businesses.

“The group’s established utilities business, comprising power generation and power transmission in Malaysia, Singapore, Indonesia and Australia, water and sewerage services in the United Kingdom and merchant multi-utility businesses in Singapore, continued to perform steadily during the quarter,” the group said in a statement.

Another subsidiary, YTL Cement Bhd, recorded a 4.4% increase in earnings to RM75.8 million for 1QFY12 ending June 30, although revenue rose 17.6% to RM544.7 million (y-o-y).

Property development arm YTL Land & Development Bhd saw a fall in net profit to RM2.9 million for 1QFY12 versus RM3.2 million last year. Revenue declined to RM3.4 million from RM14 million, owing to “timing differences of project launches” and higher operating expenses, it said.

YTL E-Solutions Bhd recorded a RM9 million net profit for 1QFY12, compared with RM2.2 million last year, with revenue doubling to RM20.8 million from RM9.2 million. It attributed growth to the fee income derived from a spectrum sharing agreement in relation to its 2.3 GHz Worldwide Interoperability for Microwave Access spectrum.


This article appeared in The Edge Financial Daily, November 18, 2011.



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