Astro Malaysia Holdings Berhad (AMH) | Result highlights for the second quarter of the financial year ending 31 January 2024 (Q2FY24)

• Revenue at RM870mn

• PATAMI +49% q-o-q to RM24mn

• ARPU +RM1.70 y-o-y, +RM0.40 q-o-q to RM99.10

• Broadband base +27% y-o-y

Amid the known macroeconomic headwinds and foreign currency volatility, Astro posted revenue of RM870mn in Q2FY24, with the broadband segment continuing to register good growth. PATAMI rose 49% q-o-q to RM24mn in Q2FY24, in part due to lower unrealised forex losses on transponder lease liabilities as the US Dollar continued to strengthen against the Ringgit. The Group remains cash generative and proactive in its capital management.

As Astro balances the competing needs of reinvesting into the growth of adjacent businesses, preserving liquidity to strengthen the balance sheet and rewarding shareholders through dividends, the Board has approved a revision to Astro’s dividend policy, effective immediately, from the financial year ending 31 January 2024. The Group intends to distribute yearly dividends from consolidated PATAMI (and will continue to review the dividend policy as circumstances change).

In line with this policy, there will be no dividends this quarter. Euan Smith, Group CEO of Astro said: “As we pivot to be a digital, streaming company, Astro’s TV packs, which can be bundled with our own internet service, Astro Fibre, continue to see good take-up. ARPU grew by RM1.70 y-o-y and by RM0.40 q-o-q to RM99.10 in Q2FY24, with our broadband base rising 27% y-o-y. Our premium local signatures, dramas and originals, with fresh content such as Sepahtu Reunion Live, Real Men Malaysia: Wira Merah, Jack Yusof and Once Upon a Kopitiam remain Astro’s key differentiator.

This quarter, our movie Malbatt: Misi Bakara did exceptionally well at the local box office, grossing over RM32.5mn to date. Polis Evo 3 completed its cinema run with total ticket sales of RM54mn, emerging as the No.1 movie in Malaysia and beating Hollywood blockbusters. It is now winning audiences on our Astro First Pay Per View service, collecting over RM1.7mn to date.”

“Our streaming ambitions are on track. Streaming on Ultra and Ulti boxes and Astro GO is up, with On Demand shows streamed rising by 31% y-o-y to 389mn in H1FY24. Ultra and Ulti Boxes installs grew 37% y-o-y to 930k while Astro GO saw 508k monthly active users averaging a weekly viewing time of 3.3 hours.

We continue to aggregate the best of streaming and lifestyle apps onto our Ultra and Ulti boxes, with launches of Qalbox, SYOK and MyAstro expanding our family of apps to 14. Qalbox by Muslim Pro offers an unparalleled selection of Muslim centric content. SYOK, Malaysia’s most popular audio entertainment app, brings to the centre of the home all Malaysia’s favourite radio stations and podcasts, while the integration of MyAstro app gives customers the convenience of seamlessly managing their account directly from the TV,” Euan added.

Key Highlights

1. Live sports, Astro Originals creating waves of excitement
2. Adex stable y-o-y
3. Sooka strengthens sports and entertainment content

• Sooka recently introduced a new raft of Kids’ content, the LIVE Rugby World Cup coverage and expanded its Chinese entertainment portfolio, strengthening its value proposition. 10 new Free Ad-supported Streaming TV (FAST) channels were also launched (a first for Southeast Asia) which provide additional free content for sooka users to explore in addition to a content library of over 30k hours. More digital natives are watching live sports and entertainment on sooka, which recorded 820k monthly active users. 1.2mn users have been registered to date, 70% of whom are on mobile. Sales of Liga Malaysia Single Match Passes exceeded 182k while 12.6k Liga Malaysia Monthly Passes were sold.

4. Astro to offer world class post-production services with business acquisition of Basecamp Films

• Astro’s wholly owned subsidiary Astro Productions Sdn Bhd (APSB), has entered into an asset purchase agreement with Basecamp Films Sdn Bhd, an award-winning visual post production studio. As part of the agreement, Basecamp Films’ staff and their expertise, experience and assets will be integrated within APSB to form a new unit, Astro Sound+Vision, designed to deliver the future of post-production excellence in Malaysia, both for Astro and the wider industry.

5. Kids friendly mode

• As a responsible broadcaster, Astro strives to provide a safer entertainment experience with the introduction of the Kids Friendly Mode, ensuring that children can only access shows that are suitable for them. The feature is available on the Astro Ultra and Ulti Boxes, Astro GO and the Multiroom Smart TV app.

6. Strong anti-piracy actions

For the common good of the entertainment industry and to protect the rights of paying customers, Astro continues to work closely with the authorities and industry stakeholders to ensure that anti-piracy measures are effectively enforced. Recent actions against piracy and copyright infringement include:
7. Strengthening our sustainability strategy

Astro’s transformation journey sees the company pushing aggressively into the future to be The Entertainment and Streaming Destination of Choice for Malaysians. Investments are firmly focused on long term and sustainable growth of the company which will encompass:
Euan said, “We are committed to invest in content, our core competitive advantage. Over RM300 million has been earmarked into FY24’s content production thereby pollinating, nurturing and enhancing the best talent within the local content scene. Astro accounts for half of all content investment in Malaysia, with the Group’s local content capturing a huge 77% share of viewing. From the fresh storytelling of Astro Originals to the new format reality competition show such as Battleground Malaysia – Road To Gold and the use of AWANI’s AI avatar news anchors, Joon and Monica, in newsroom operations, we are reinventing our content proposition to meet the increasing demand for high quality local content across screens and genres.”

“Our focus is also on scaling sooka, our freemium streaming service for sports and vernacular enthusiasts, available on both mobile and the big screen through its smart TV app. Our internet service Astro Fibre continues to see encouraging traction especially as broadband content bundles, available to both residential and enterprise customers. As the world progresses towards a “cookie-less” world, we see a future of increased relevance for our proprietary first party data, and therefore for our Addressable Advertising solution.

The ability to serve targeted ads to different homes simultaneously – based on location, affluence and other demographics – will eventually spearhead Addressable to become the advertising norm for advertisers in Malaysia. Our holistic audience measurement, which cuts across Linear and On Demand (including Astro GO), will soon be augmented to include out-of-home reach in Commercial Establishments.”

Prolonged macroeconomic headwinds continue to persist, as does the dollar strength and volatility, the seismic shift in the global industry, and ongoing cost of living pressures. The Group is mindful of this, providing support and even better value to customers wherever possible. We maintain a cautious outlook and will carefully monitor business conditions whilst prudently managing costs.