KUALA LUMPUR (Nikkei Markets) - Pay-television operator Astro Malaysia Holdings said Thursday its net profit nearly-doubled on year in the fiscal second quarter thanks largely to lower content costs and unrealized foreign exchange gain.
Net profit for the three months ended July 31 totalled 246.34 million ringgit ($58.62 million) compared with 125.43 million ringgit over the same period last year, Astro Malaysia said in an exchange filing. Quarterly revenue dropped 0.7% year-on-year to 1.42 billion ringgit from 1.43 billion ringgit.
"Viewing across multiple screens and on demand consumption are gaining momentum," Astro Malaysia said. "Going forward, the company expects revenue growth in the immediate term to be underpinned by e-commerce, adex, production revenues and NJOI."
Astro Malaysia, which commands a virtual monopoly pay-TV business in its home market, is seeking to expand its subscriber base and boost home shopping business at a time of shrinking advertisement spending across most media in the country.
Businesses have held back spending tracking tepid consumer sentiment amid a rise in cost of living. The company's main competitors for advertising revenue - Media Prima, Media Chinese International, and Star Media Group - have witnessed declines in respective profits in their most recent quarter.
Astro Malaysia's revenue from television, from which it derives bulk of its profit, slipped 0.6% in the second quarter mainly due to lower package take-up and loss of content recovery for sports channel. Radio segment's revenue rose 2.5% due to better yield and inventory management.
Home-shopping's revenue, meanwhile, fell 5.4% due to "additional tactical campaigns executed" during the quarter, the company said.
For the first six months, net profit climbed 35% to 442.17 million ringgit from 327.60 million ringgit over the same period last year. Revenue however dropped 1.4% to 2.75 billion ringgit compared with 2.79 billion ringgit over the same six months last year.
Average revenue per residential subscriber of its pay-TV service rose to 100.8 ringgit a month from 99.2 ringgit. The company has 5.3 million customers and 16 million weekly radio listeners at the end of July, Astro said.
"The group is cautiously optimistic for the rest of the financial year, despite relatively subdued consumer sentiment," Astro Malaysia reiterated. Still, the company will remain "cash generative and will focus on investing in growth strategy," it added.
Shares of Astro Malaysia fell 1.9% to 2.63 ringgit on Thursday while the benchmark FTSE Bursa Malaysia KLCI was down 0.3%