ASTRO: Earnings Rebounded

Results Update

For QE31/7/2019, Astro's net profit rose 9 folds y-o-y to RM169 million on the back of a 13%-drop in revenue to RM1.24 billion. Compared to the immediate preceding quarter (QE30/4/2019), net profit dropped 4% while revenue rose marginally by 0.2%.

Revenue was lower by RM180 million or 13% against corresponding quarter mainly due to a decrease in subscription revenue and licensing income. EBITDA margin improved by 15.0% against corresponding quarter, due to lower content costs and marketing and distribution expenses. Net Profit increased by RM153 million or 10 folds compared with the corresponding quarter mainly due to increase in EBITDA and lower net finance costs, offset by higher tax expenses.


Table: Astro's last 8 quarterly results


Graph: Astro's last 32 quarterly results

Financial Position

Astro's financial position improved slightly with current ratio of 0.98 time and gearing ratio of 6.6 times.

Valuation

Astro (closed at RM1.39 in the morning session) is now trading at a trailing PE of 11 times (based on last 4 quarters' EPS of 11.83 sen). In addition, Astro paid out dividend quarterly which amounted to 6 sen for the last 4 quarters; giving the stock an attractive DY of 4.3%. Based on these PER and DY, Astro is deemed fairly attractive.

Technical Outlook

Astro is trapped in a triangle, with the upside capped at RM1.45 and downside supported at RM1.30. Until Astro can break out of this triangle, it will likely be around the RM1.40 level.


Chart 1: Astro's daily chart as at Sep 13, 2019_12.30 (Source: Malaysiastock.biz)


Chart 2: Astro's weekly chart as at Sep 13, 2019_12.30 (Source: Malaysiastock.biz)

Conclusion

Based on improved financial performance, I believe Astro is still a good stock for long-term investment based on fair valuation.

Note:

I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

Astro: End of a Monopoly

Astro lost its monopoly over paid TV broadcasting (here). While existing competitors, such as HYPP TV, cannot match with Astro's current offering. However the real game-changer may be the high speed broadband which may bring out competitors from the left field that we have yet to factor in the impact.

Notwithstanding the above, I believe that this news has been discounted over the past few months. I think if Astro dropped to RM1.00, it could be a good long-term BUY.


Chart: Astro's weekly chart as at Nov 19, 2018 (Source: Malaysiastock.biz)

Astro: Earnings Plunged

Results Update

For QE31/7/2018, Astro's net profit dropped 91% q-o-q or 93% y-o-y to RM17 million while revenue was mixed- up 8% q-o-q but down 0.2% y-o-y to RM1.42 billion.

Revenue dropped y-o-y mainly due to a decrease in subscription and advertising revenue, offset by higher merchandise sales, licensing income and sales of program broadcast rights. The decrease in subscription revenue was mainly due to lower package take-up and the decrease in advertising revenue was due to lower spending over festivities as compared to corresponding quarter. The increase in merchandise sales was due to increase in number of products sold, mainly driven by the tactical campaigns executed for the current quarter.

Net profit decreased y-o-y mainly due to higher content costs from FIFA World Cup and higher cost of merchandise sales and higher net finance costs. Higher net finance cost was mainly due to unfavorable unrealized forex movement arising from unhedged finance lease liabilities and vendor financing and increase in interest expenses from borrowings. The drop was partially offset by lower tax expenses.


Table: Astro's last 8 quarterly results


Graph: Astro's last 28 quarterly results

Financial Position

Astro's financial position is weak with current ratio of 0.9 time and gearing ratio of 9 times. I believe that the investment community accepts these weak ratios because of the concession-like income stream. Will the faster and cheaper broadband affect this assumption in the future? We will ahve to wait and see.

Valuation

Astro (closed at RM1.66 yesterday) is now trading at a trailing PE of 16 times (based on last 4 quarters' EPS of 9.97 sen). In addition, Astro paid out dividend quarterly which amounted to 11.50 sen for the last 4 quarters; giving the stock an attractive DY of 6.9%. Based on these PER and DY, Astro is deemed fairly attractive.

Technical Outlook

Astro dropped from RM2.90 in October last year to a low of RM1.31 in May this year. After a rebound to RM1.97 in August, the share price is again on the retreat. It may re-test the low- hopefully giving us a double bottom!


 Chart: Astro's weekly chart as at Sep 26, 2018 (Source: Malaysiastock.biz)

Conclusion

Despite the weaker financial performance, I believe Astro is still a good stock for long-term investment based on fair valuation. For those who like to buy into Astro, you can afford to wait for lower prices before accumulating.

Note:

I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

Astro: Earnings Continued To Rise

Results Update

For QE31/1/2018, Astro's net profit rose 24% q-o-q or 25% y-o-y to RM182 million while revenue dropped 0.6% q-o-q or 0.7% y-o-y to RM1.39 billion.

Revenue dropped y-o-y mainly due to a decrease in subscription revenue, offset by higher merchandise sales, advertising and production revenue. The decrease in subscription revenue was mainly due to lower package takeup. The increase in merchandise sales was due to increase in number of products sold which was mainly driven by the tactical campaigns executed for the current quarter. The increase in advertising revenue was due to higher spending for year-end festive celebration.

Net profit increased by RM37.6m or 26.3% compared with the corresponding quarter due to lower net finance costs. Lower net finance cost was due to favorable unrealised forex gain arising from unhedged non-current balance sheet liabilities comprising, finance lease liabilities and vendor financing. The increase was offset with decrease in EBITDA and higher tax expenses.


Table 1: Astro's last 8 quarterly results


Graph: Astro's last 26 quarterly results

Valuation

Astro (closed at RM2.02 yesterday) is now trading at a trailing PE of 13.7 times (based on last 4 quarters' EPS of 14.79 sen). In addition, Astro paid out dividend quarterly which amounted to 12.50 sen for the last 4 quarters; giving the stock an attractive DY of 6.2%. Based on these PER and DY, Astro is deemed fairly attractive.

Technical Outlook

Astro dropped from RM2.90 in October last year to a low of RM2.02 yesterday. It is now revisiting the low when the stock was re-quoted in October 2012.


 Chart: Astro's weekly chart as at Mar 28, 2018 (Source: Malaysiastock.biz)

Conclusion

Based on satisfactory financial performance & attractive valuation, I believe Astro is a good stock for long-term investment.

Note:

I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

Astro: Looking Even More Attractive

Astro has been dropping over the past 4 months, from a high of RM2.90 to a low of RM2.14 now. If you look at the chart below, we can see that Astro share prices have been moving in a steep downward channel, ABCD which flattened out slightly into WXYZ. Occasionally it would go below the lower line before rebounding back into the downward channel (see C"D" and Y"Z"). Assuming this pattern persists, Astro may test the second lower, Y"Z" possibly at RM2.10 before recovery.

Astro (currently at RM2.16) is now trading at a trailing PER of 15.3 times (based on last 4 quarters' EPS of 14.1 sen) and has a dividend yield of 5.8% (based last 4 quarters' dividend totaling 12.5 sen). At these ratios, Astro is deemed fairly attractive.


Chart: Astro's weekly chart as at Mar 20, 2018_4.06pm  (Source: Malaysiastock.biz)

Conclusion

Based on satisfacoiry financial performance & attractive valuation, Astro is considered a good stock for long-term investment.

Note:
I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

Astro: Earnings may get a Boost from WC2018

Results Update

For QE31/10/2017, Astro's net profit dropped 40% q-o-q or 3% y-o-y to RM147 million while revenue dropped 2% q-o-q and y-o-y to RM1.40 billion.

Revenue dropped y-o-y mainly due to a decrease in subscription, advertising and licensing revenue, offset by higher production revenue. The decrease in subscription revenue was mainly due to lower package take-up. The decrease in advertising revenue was due to subdued advertising market. The decrease in licensing revenue was due to loss of content recovery for sports channel.

Net profit decreased y-o-y due to decrease in EBITDA, which was offset with impairment of investment in associate of RM15.1 million in the corresponding quarter and lower net finance costs. Lower net finance cost was due to favorable unrealized forex gain arising from unhedged non-current balance sheet liabilities comprising, finance lease liabilities and vendor financing.
(Note: Astro's result for QE31/10/2017 was announced on December 6, 2017.)


Table 1: Astro's last 8 quarterly results


Graph: Astro's last 25 quarterly results

Prospect for FY2019

Being the main provider of live sport event, Astro is likely to get a boost from FIFA World Cup 2018. To compute the financial impact, I have compared the increase in revenue and  profit for the TV segment from FIFA World Cup 2014. We can see the TV segmental revenue & profit for 1H2015 increased by 13% and 28% respectively. Net profit rose by 25% from RM213 million to RM266 million in 1H2015.

Assuming the same level of increase were to happen in 1H2019, then revenue & segmental profit would increase to RM3.057 billion & RM764 million respectively while net profit would increase to RM552 million. Divided by total shares outstanding of 5214 million, 1H2019 EPS would be about 10.6 sen. Assuming 2H2019 EPS is about 6 sen, then Astro's full-year earning for FY2019 would be about 16.6 sen- giving the stock a prospective PER of 15.7times.


Table 2: Astro's forecast earning for 1H2019

Valuation

Astro (closed at RM2.60 on Thursday) is now trading at a trailing PE of 18 times (based on last 4 quarters' EPS of 14.09 sen). In addition, Astro paid out dividend quarterly which amounted to 12.50 sen for the last 4 quarters; giving the stock a decent DY of 4.8%. Based on the above PER and DY, Astro is fairly attractive.

Technical Outlook

Astro is transitioning from a downtrend to a sideways trend, with resistance from the line, XY and support from the line, AB.


 Chart: Astro's weekly chart as at Jan 30, 2018 (Source: Malaysiastock.biz)

Conclusion

I like to revise Astro's rating from a HOLD to a BUY based on steady financial performance, relatively attractive valuation & potential boost from WC2018.

Note:

I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

Astro: Earnings Weaker y-o-y

Results Update

For QE30/4/2017, Astro's net profit rose 35% q-o-q but dropped 3% y-o-y to RM196 million while revenue dropped 5% q-o-q or 3% y-o-y- at RM1.326 billion.

Revenue dropped y-o-y mainly due to a decrease in licensing, subscription and advertising revenue. The decrease in licensing revenue was due to loss of content recovery for sports channel. The decrease in subscription revenue was mainly due to lower package take-up. Lower advertising revenue in the current quarter owing to Chinese New Year advertisement spending recorded in the corresponding quarter.

Net profit decreased y-o-y due to increase in the proportion of content costs against revenue and increase in net finance costs, offset by lower depreciation of property, plant and equipment. Higher net finance cost was due to lower unrealised forex gain arising from unhedged non-current balance sheet liabilities comprising, finance lease liabilities and vendor financing.


Table: Astro's last 8 quarterly results

Astro's revenue seems to have broken its "uptrend". Can the profits "uptrend" sustain if revenue uptrend ceased? The break in the revenue uptrend is a concern, especially with the start of the Free Digital Broadcast under MYTV.


Graph: Astro's last 23 quarterly results

Valuation

Astro (closed at RM2.70 yesterday) is now trading at a trailing PE of 23 times (based on last 4 quarters' EPS of 11.86 sen). At this PER, Astro is fairly valued. However, Astro paid out dividend quarterly which amounted to 12.50 sen for the last 4 quarters; giving the stock a decent DY of  4.6%.

Technical Outlook

Astro is in a downtrend line, at RM2.80.Immediate support is from the horizontal line at RM2.50.


 Chart: Astro's weekly chart as at Jun 15, 2017_12.30pm (Source: ShareInvestor.com)

Conclusion

Despite its steady financial performance and fair valuation, Astro's rating remains a HOLD because it has not broken above its downtrend line.

Note:

I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

Astro: Earning Improved

Results Update

For QE31/10/2016, Astro's net profit rose 20% q-o-q or 42% y-o-y to RM151 million while revenue was relatively unchanged - down 0.3% q-o-q or up 3.6% y-o-y- at RM1.424 billion.

Its revenue dropped y-o-y due to a decrease in subscription and home-shopping of RM5.7 million and RM11.9 million respectively, which offset by an increase in advertising and other revenue RM1.8 million and RM11.6 million respectively.

EBITDA margin increased by 3.1% y-o-y mainly due to lower content costs, particularly EURO 2016 in the preceding quarter and lower impairment of receivables. Net profit increased y-o-y mainly due to an increase in EBITDA of RM42.7 million, lower net finance costs by RM12.1 million due to lower unrealized forex loss arising from unhedged finance lease liability of RM5.6 million and unhedged vendor financing of RM2.3 million. The increase was offset by impairment of investment in associate of RM15.1 million and higher tax expense of RM15.4 million. RM34.6 million  and  lower  net  finance cost by RM18.7 million. 


Table: Astro's last 8 quarterly results


Graph: Astro's last 21 quarterly results

Valuation

Astro (closed at RM2.65 yesterday) is now trading at a trailing PE of 20.2 times (based on last 4 quarters' EPS of 13.11 sen). At this PER, Astro is fairly valued. However, Astro paid out dividend quarterly which amounted to 12.75 sen for the last 4 quarters; giving the stock a decent DY of  4.8%.

Technical Outlook

Astro dropped back below its long-term downtrend line, now at RM2.80. The downtrend has gathered momentum, with ADX rising steeply. With Stochastic oversold, a relief rally can set in but it would probably be capped at the downtrend line at RM2.80.


 Chart: Astro's weekly chart as at Dec 7, 2016 (Source: ShareInvestor.com)

Conclusion

Based on improved financial performance and fair valuation, Astro's rating remains a HOLD. If Astro can break above its downtrend line at RM2.80, the rating can be revised to a Long-Term BUY.

Note:

I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

Astro: Earnings Dipped

Results Update

For QE31/7/2016, Astro's net profit dropped by 38% q-o-q or 9% y-o-y to RM125 million even though its revenue increased by 5% q-o-q or 4% y-o-y to RM1.428 billion.

Revenue rose y-o-y mainly due to an increase in subscription, advertising, home-shopping and other revenue of RM1.7 million, RM17.6 million, RM36.7 million and RM3.3 million respectively. The higher revenue performance for home-shopping was due to increase in number of products sold and launch of Chinese Channel in October 2015.

EBITDA margin decreased by 6.0% y-o-y due to higher content costs, particularly EURO 2016 and impact of weakening RM, offset against discounts received from renegotiated content contracts.

Net profit decreased by 9.0% y-o-y due to decrease in EBITDA of RM63.5 million, offset by a decrease in depreciation of property, plant and equipment by RM34.6 million and lower net finance cost by RM18.7 million. 


Table: Astro's last 8 quarterly results


Chart 1: Astro's last 20 quarterly results

Valuation

Astro (closed at RM2.95 yesterday) is now trading at a trailing PE of 24 times (based on last 4 quarters' EPS of 12.25 sen). At this PER, Astro is fully valued. However, Astro paid out dividend quarterly which amounted to 12.5 sen for the last 4 quarters; giving the stock a decent DY of  4.2%.

Technical Outlook

Astro has broken above its long-term downtrend line at RM2.90. The breakout was not accompanied by increased volume nor upward momentum (ADX is flat!). Without public participation, its upside is capped by the horizontal line at RM3.00. For now, Astro is likely to continue to hang around the intermediate uptrend line support at RM2.85-2.90.

 
Chart 2: Astro's weekly chart as at Sep 14, 2016 (Source: ShareInvestor.com)


Chart 3: Astro's monthly chart as at Sep 14, 2016 (Source: ShareInvestor.com)

Conclusion

Based on weak financial performance, demanding valuation & unexciting technical outlook Astro's rating remains a HOLD.

Note:

I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

Astro: Earnings Soared

Results Update

For QE31/1/2016, Astro's net profit increased by 92% q-o-q or 46% y-o-y to RM204 million while revenue was up marginally by 2% q-o-q or 4% y-o-y to RM1.374 billion.

Revenue rose y-o-y mainly due to an increase in subscription, advertising and other revenue of RM7.8 million, RM24.8 million and RM21.0 million respectively. EBITDA  margin  increased  by  0.6%  against  corresponding  quarter  mainly  due  to  lower  staff  related  costs, and lower impairment of receivables. This was offset by higher content costs and cost of merchandise sales.

Net profit increased by RM65.1 million or 47.2% compared with the corresponding quarter. The increase in net profit is  mainly due to increase in EBITDA of RM27 million, lower net finance cost by  RM30.0 million due to lower  unrealised forex  loss  arising  from  unhedged  finance  lease  liability  of  RM19.4 million  and  unhedged  vendor  financing  of RM34.7 million,  offset  by  an  increase  in  transponder’s  lease  interest  of  RM6.8 million  and  increase  in  share  of post-tax result from investment accounted for of RM12.9 million, offset by higher tax expenses by RM11.2 million. 


Table: Astro's last 8 quarterly results


Chart 1: Astro's last 18 quarterly results

Valuation

Astro (closed at RM3.00 yesterday) is now trading at a trailing PE of 25 times (based on last 4 quarters' EPS of 11.83 sen). At this PER, Astro is full valued. If Astro can maintain its last quarter's performance for a full year, the group's EPS would rise to 16 sen while its PER would drop to 20 times. At a PER of 20 times, the stock would be attractive.

In addition, Astro paid out dividend quarterly which amounted to 12 sen for the last 4 quarters. Thus, its DY is at a decent 4%.

Technical Outlook

Astro has been drifting downward after it peaked at RM3.70 in June 2014. The price moves in a downward channel, RR-R1R1) wth support at RM2.40-2.50 & resistance at RM3.00.


Chart 2: Astro's weekly chart as at Mar 22, 2016 (Source: ShareInvestor.com)

Conclusion

Despite the improved financial performance, Astro's rating remains a HOLD due to its expensive valuation and bearish technical outlook.

Note:
In addition to the disclaimer in the preamble to my blog, I hereby confirm that I do not have any relevant interest in, or any interest in the acquisition or disposal of, Astro.

Astro: Earnings dropped

Results Update

For QE31/10/201530/9/2015, Astro's net profit dropped by 22.8% q-o-q or 7.4% y-o-y to RM106 million while revenue was up marginally by 0.4% q-o-q or 7.4% y-o-y to RM1.374 billion.

Revenue rose y-o-y due to an increase in other revenue of RM23.1 million, offset by decrease in subscription and advertising of RM10.5 million and RM7.2 million respectively. The increase in other revenue is due to an increase in merchandise sales of RM14.6 million from home-shopping business and sales of programming rights of RM8.4 million.

Net profit decreased by RM31.7 million mainly due to decrease in EBITDA of RM16.1 million, higher net finance costs by RM36.4 million due to unrealised forex impact primarily arising from unhedged finance lease liability of RM54.5 million and unhedged vendor financing of RM8.8 million, offset by decrease in discounting of transponder’s deposit to its present value of RM22.0 million. The decrease was offset by lower depreciation of set-top boxes of RM10.2 million and lower tax expenses of RM16.1 million.


Table: Astro's last 8 quarterly results


Chart 1: Astro's last 17 quarterly results

Valuation

Astro (closed at RM2.86 yesterday) is now trading at a trailing PE of 27 times (based on last 4 quarters' EPS of 10.6 sen). At this PER, Astro is over-valued. However, Astro paid out dividend quarterly which amounted to 12.5 sen for the last 4 quarters. Thus, its DY is at a decent 4.4%.

Technical Outlook

Astro has been drifting downward after it peaked at RM3.70 in June 2014. Its immediate support is at RM2.80-2.90 while its immediate resistance is at RM3.00-3.10.


Chart 2: Astro's weekly chart as at Dec 8, 2015 (Source: ShareInvestor.com)

Conclusion

Based on weak financial performance, expensive valuation & weak technical outlook, Astro's rating remains at best a HOLD but preferably an AVOID.

Note:
In addition to the disclaimer in the preamble to my blog, I hereby confirm that I do not have any relevant interest in, or any interest in the acquisition or disposal of, Astro.