Digi posted a 77%-jump in net profit y-o-y to RM200.6 million in 2Q06 from RM113.49 million last year. The strong performance was due to a high subscriber growth, which contributed to a revenue growth of 31.75% y-o-y to RM903.69 million in 2Q06 from RM685.88 million in 2Q05. Its customer base rose 44% to 5.44 million in the 2Q06 from 3.77 million a year earlier. The increase in customer base for 2Q06 was a bit slower at 354,000 when compared to increases in previous quarters.
Digi's earnings per share for the six month period grew to 51.4 sen from 22.9 sen a year earlier. On an annualised basis, its earning will amount to 102.8 sen per share. Based on its closing price today (July 20) of RM11.50, its PE stands at only 11.2 times only.
In addition, Digi has also declared an interim gross dividend of 53.5 sen per share. This will be Digi's first dividend for the current financial year. The shareholders can also look forward to another big "payout" in the form of a second capital repayment of 60 sen per share. Digi has completed its first capital repayment of 75 sen in May this year.
With all these good news, I believe that Digi's share price is likely to rally further in the days ahead.
Note: I like to correct an error in my first post on Digi where I've mentioned that there were only 3 applicants in the tender for the wireless broadband spectrum known as WIMAX. Subsequent newspaper reports indicate that the total number of applicants were 17 and these include big names such as Maxis and Telekom Malaysia. In such a crowded field and with only 3 spectrum blocks up for grab, it may not be fair to assume that Digi is a frontrunner.
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