Earnings Report /

Intouch Holdings PCL: Core number missed estimate; 1Q22 core profit to recover YoY and QoQ

  • Lower core profit than modeled

  • INTUCH posted a 4Q21 net profit of Bt2.61bn

  • It paid a 2H21 DPS of Bt1.6/share

Bualuang Securities
11 February 2022

Our BUY rating stands, premised on its attractive valuation with a current 12.6% holding discount. Its scope for upside will come from ADVANC’s 5G further ARPU uplift and the CCIID robust revenue growth in the enterprise business riding on the digital transformation trend and THCOM’s satellite orbital slot auctions in 2022.

Lower core profit than modeled

INTUCH posted a 4Q21 net profit of Bt2.61bn, down 2% both YoY and QoQ. Excluding extra items in 4Q21—1) Bt24m in THCOM’s proportionate FX loss, 2) Bt17m in THCOM’s proportionate reversal of asset impairment loss, 3) Bt67m in ADVANC’s proportionate tax benefits from investment 4) Bt66m in ADVANC’s proportionate net FX gain and 5) Bt12m in INTUCH’s extra expenses—its core profit was Bt2.5bn, up 2% YoY but down 7% QoQ. Its net and core profits were 3% and 7% below our model mainly due to THCOM’s huge equity loss from Laos Telecom (LTC). ADVANC’s core profit was aligned with our model, but THCOM’s Bt55m core loss flouted our Bt43m core profit estimate. It paid a 2H21 DPS of Bt1.6/share or at a 97.3% dividend payout ratio of consolidated 2H21 EPS (against Bt1.23/share for 1H21 or at a 72.1% payout ratio), which was higher than our estimate. The 2021 DPS of Bt2.83/share was equal to the 84.4% payout ratio.