Earnings Report /
Thailand

Total Access Communication PCL: Core profit below estimate; bigger recovery scale expected in 2H22

  • Net profit beat our estimate but core profit missed it

  • DTAC posted a Bt1bn net profit for 2Q22

  • The YoY core profit tumble was attributed to the drop in service revenue

Bualuang Securities
18 July 2022

We reiterate our TRADING BUY on DTAC and expect the NBTC to decide on the TRUE-DTAC amalgamation deal in Aug 2022. We assign a 90% probability that the NBTC will approve the deal.

Net profit beat our estimate but core profit missed it

DTAC posted a Bt1bn net profit for 2Q22, down 34% YoY but up 38% QoQ. Excluding six extra items in 2Q22—Bt0.5m FX gain, Bt4m gain on the fair value hedge, Bt1bn in one-time gain arising from the filter costs which are deductible from the USO fees, Bt150m gain from the network OPEX item, Bt140m in one-time amalgamation-related costs and Bt560m in provision related to the fire incident—core profit was Bt549m, down 51% YoY and 35% QoQ. Net profit beat our model by 33% thanks to the above one-time gain items but core profit missed our estimate by 37% due to higher depreciation and amortization, general administrative and bad debt expenses (which beat our model by 7%, 6% and 41%, respectively). On the positive side, service revenues (excl. IC) beat our estimate by 2.4% and handset loss was 8% shallower than modelled.