Annual Report 2008 - Axiata Group Berhad - Investor Relations

Group Financial Review (cont’d.)XLIn 2008, XL outperformed the industry in terms ofrevenue and EBITDA growth and increased its marketshare. XL grew its top line revenue by 45.3% YoYwhile EBITDA margin increased 0.2% to 42.2%, despiteintensified competition and the global economic crisisin the second half of the year.Total revenue reached IDR12,156.0 billion, an increasefrom IDR8,364.7 billion in 2007, mainly driven byexponential growth in total minutes and a largercustomer base. All segments experienced positivegrowth with additional revenue from the tower businessin 2008. Prepaid subscribers accounts for 98.4% of itstotal subscriber base. Prepaid revenue was 58.0%higher YoY at IDR8,849.4 billion and contributed 72.8%to the total revenue. In 2008, XL had a new revenuestream from the leasing out of tower space, amountingto IDR276.7 billion, which made up 2.3% of the totalrevenue.Total operating expenses increased 54.7% YoY toIDR6,929.7 billion, mainly due to increase ininterconnection and telecommunication service chargesand network infrastructure expenses.Dialog GroupRevenue growth was mitigated by successivereductions in mobile telephony charges during thecourse of 2008, in line with the company’s consciousdecision to lower tariff charges to subscribers in thewake of economic pressures. Results of this strategyare evidenced by the company’s continued success incapturing a major share of mobile subscriber additionsacross Sri Lanka, notwithstanding aggressivecompetition from other operators in the country.For the year ended 31 December 2008, the DialogGroup recorded consolidated revenue of SLR36.2billion, a growth of 6.0% compared to the previousyear which was SLR34.1 billion.Dialog Group costs grew by 40.5% YoY resulting in adecline in EBITDA at SLR7.8 billion against SLR13.9billion in 2007. Inflationary effects in the first half ofthe year of above 20% and the economic downturn inthe second half of the year, impacted the EBITDA andPAT of the Group. The Group recorded a loss ofSLR2.9 billion for 2008, representing negative growthin group earnings of 132.3% YoY.EBITDA increased 46.3% YoY to IDR5,131.5 billion andmargin increased to 42.2% as a result of strong costmanagement, despite lower average tariffs perminute.Normalised net income declined 51.8% YoY due tohigher interest expenses from higher interest bearingdebts, higher depreciation, driven by accelerateddepreciation on XL core equipment amounting toIDR451.0 billion, and foreign exchange loss of IDR332.2billion.44Axiata Group Berhad Annual Report 2008(formerly known as TM International Berhad)