Business

Dialog grows 16% in Q1, forex flips NPAT to negative Rs.15.8Bn

Published

4 years ago

2022/05/18

• Q1 22 Revenue and EBITDA record YoY growth of 16% and 8% respectively • YTD Q1 22 NPAT Negative at Rs15.8Bn, impacted by Forex Loss of Rs.20.2Bn. Normalised NPAT Rs.4.3Bn • Total Taxes Paid to GoSL Rs5.9Bn which included Rs2.1Bn in Direct and Rs3.8Bn in Indirect Taxes • Capex Investments of Rs7.5Bn during the Quarter; OFCF reached Rs6.2Bn for Q1 2022

Dialog Axiata PLC announced,Friday 13th May 2022, its consolidated financial results for the three monthsended 31st March 2022. Financial results included those of Dialog Axiata PLC (the “Company”) and of the Dialog Axiata Group (the “Group”). Sri Lanka is engulfed in an economic and political crisis resulting from the impacts of COVID-19, significant tax cuts and large sovereign debt repayments collectively depleting the limited foreign reserves of the country. As a result, the Sri Lankan Rupee (“LKR”) depreciated by 46% against the USD during Q1 2022.

Despite the challenging environment, all business segments, namely, Mobile, Fixed Line, Digital Pay Television, International and Tele-infrastructure businesses positively contributed to record a consolidated Revenue of Rs38.3Bn for Q1 2022, demonstrating a strong growth of 16% Year-on-Year (“YoY”) and 3% Quarter-on-Quarter (“QoQ”). Underpinned by Revenue growth, Group Earnings Before Interest, Tax, Depreciation and Amortisation (“EBITDA”) grew 8% YoY albeit declining 4% QoQ to record at Rs14.7Bn for Q1 2022. The QoQ decline in EBITDA was driven by higher spend on network and direct costs due to escalation of dollar denominated expenses and increase in energy costs due to power cuts.

The Group Net Profit After Tax (“NPAT”) was negative for Q1 2022 at Rs15.8Bn, impacted by the steep depreciation of the LKR against the United States Dollar (“USD”) by 46% for Q1 2022 versus a depreciation of 7.1% for Q1 2021 and a stable movement in Q4 2021. The forex loss of Rs.20.2Bn recorded by Dialog Group was due to outstanding USD denominated debt obligations and foreign vendor liabilities. The USD debt obligation for the Group totalled USD145Mn by end Q1 2022. Normalised for the said foreign exchanges loss Group NPAT was recorded at Rs4.3Bn for Q1 2022 declining 4% YoY and 11% QoQ.

Public Dialog Group continued to be a significant contributor to state Revenues, remitting a total of Rs5.9Bn to the Government of Sri Lanka (“GoSL”) during Q1 2022. Total remittances included Direct Taxes and Levies amounting to Rs2.1Bn as well as Rs3.8Bn in Consumption Taxes collected on behalf of the GoSL.

The Group remains committed to provide seamless and consistent connectivity to all Sri Lankans during these unprecedented times and accordingly spent Rs7.5Bn in capital expenditure for the quarter ended 31st March 2022, resulting in a Capex to Revenue ratio of 20% for Q1 2022. Capital expenditure was directed towards investments in High-Speed Broadband infrastructure to further expand Dialog’s leadership in Sri Lanka’s Broadband sector. The Group recorded Operating Free Cash Flow (“OFCF”) of Rs6.2Bn for Q1 2022.

The Group balance sheet continued to be low geared, despite new USD borrowings during the quarter, to record the Net Debt to EBITDA ratio at 0.49x by end Q1 2022. The Return on Invested Capital (“ROIC”) remained at healthy levels to recorded at 16.5% for Q1 2022 albeit declining 0.6pp YoY and 1.4pp QoQ In a mission to provide emergency relief to the worst impacted families and communities in the country due to the ongoing economic crisis, Dialog Group joined hands with like-minded corporates and partners including its execution partner Sarvodaya and accountability partner PwC Sri Lanka to launch the

‘Manudam Mehewara’ relief initiative. Emergency relief will be provided to more than 200,000 affected families across all 25 districts and this relief effort will continue for 60 – 90 days, until a sustainable benefit transfer system is established in the country through an effective economic recovery plan At an entity level, Dialog Axiata PLC (the “Company”) continued to contribute a major share of Group Revenue (63%) and Group EBITDA (68%). Company recorded a 10% YoY growth in Revenue to reach

Rs24.0Bn for Q1 2022 amid increased contribution from Data revenue. On a QoQ basis Revenue recorded a growth of 3%. EBITDA for Q1 2022 was recorded at Rs10.1Bn representing a moderate growth of 1% YoY on the back of escalations in Sales & Marketing, Network and Staff costs. On a QoQ basis EBITDA recorded a growth of 4%. The depreciation of the LKR against the USD impacted company NPAT resulting in a loss of Rs15.2Bn as the foreign exchange loss amounted to Rs18.3Bn for Q1 2022. Normalised for same, company NPAT was recorded at Rs3.1Bn for Q1 2022, declining 21% YoY albeit increasing 16% QoQ.

All News Advertisement

Business

Oil prices rise after ships attacked near Strait of Hormuz

Published

12 hours ago

2026/03/2

Priyan

File photo of shipping in the Strait of Hormuz, which has now ground to a halt [BBC]

Global oil prices have risen after at least three ships were attacked near the Strait of Hormuz, as Iran continues to launch strikes across the Middle East in response to ongoing attacks by the US and Israel.

Two vessels have been struck, and an “unknown projectile” was reported to have “exploded in very close proximity” to a third, the UK Maritime Trade Operations Centre (UKMTO) said.

Iran has warned ships not to pass through the strait, which carries about 20% of the world’s oil and gas.

International shipping has almost come to a standstill at the strait’s entrance, with analysts warning that a prolonged conflict could push energy prices even higher.

In early trade in Asia on Monday, global oil prices jumped by more than 10% before those gains eased during the morning.

At 02:00 GMT, Brent crude was more than 4% higher at $76.16 (£56.53) a barrel, while US-traded oil was also up by around 4% at $69.67.

“The market isn’t panicking”, Saul Kavonic, head of energy research at MST Research told the BBC.

“There is more clarity that so far, oil transport and production infrastructure hasn’t been a primary target by any side,” he added.

“The market will be watching for signs that traffic through the Strait of Hormuz returns, which would see oil prices subside again.”

But some analysts have warned it could go over $100 in the event of a prolonged conflict.

On Sunday, the Opec+ group of oil producing nations – which includes Saudi Arabia and Russia – agreed to increase their output by 206,000 barrels a day to help cushion any price rises, but some experts doubt this would help much.

Edmund King, president of the AA, warned the disruption could drive up petrol prices around the world.

“The turmoil and bombing across the Middle East will surely be a catalyst to disrupt oil distribution globally, which will inevitably lead to price hikes,” he said.

“The magnitude and duration of pump price increases depends on how long the conflict goes on.”

[BBC]

Business

Iran strikes could add external pressure on Sri Lanka’s fragile recovery: Analyst

Published

16 hours ago

2026/03/2

Sahan Weerasooriya

The U.S. and Israeli strikes on Iran have reignited geopolitical tensions in the Middle East, stoking fears of a broader conflict that could disrupt critical energy supply routes – particularly the Strait of Hormuz, through which roughly one-fifth of the world’s oil supply flows. Brent crude has already edged higher, and global oil markets warn prices could climb toward, or even exceed, US$80–100 a barrel if hostilities escalate.

Against this backdrop, an independent economic analyst told The Island that for Sri Lanka – a small, fuel-importing economy with limited domestic energy resources – the implications could be significant.

“Sri Lanka imports over 90% of its petroleum requirements, and any sustained rise in global crude prices would expand the annual import bill, placing renewed pressure on already tight foreign exchange reserves,” he said.

Even moderate spikes in oil prices, he noted, tend to filter quickly through the domestic economy. “Higher fuel costs translate into increased transport and production expenses, which feed into inflation and erode household purchasing power. Freight charges for essential goods – from food items to industrial inputs – would also rise.”

“The Middle East remains a key source of remittances and export demand,” the analyst explained. “A large share of Sri Lankan migrant workers are employed in Gulf economies, while regional markets absorb tea and other exports. Heightened instability could weaken remittance inflows and soften demand, further straining the balance of payments.”

When asked whether the Central Bank of Sri Lanka (CBSL) might be compelled to shift policy in response, the analyst said the monetary authority faces a delicate balancing act.

“Rising import inflation stemming from higher global energy prices could push the Central Bank to maintain – or even tighten – its monetary policy stance in order to safeguard price stability and support the rupee. A firmer stance may be deemed necessary to anchor inflation expectations and preserve market confidence. The Central Bank is therefore likely to monitor inflation data closely in the coming weeks to assess whether energy-driven price pressures prove temporary or more entrenched,” he said.

Meanwhile, Ceylon Petroleum Corporation (CPC) Chairman S. Rajakaruna said that Sri Lanka’s fuel imports – sourced primarily from Singapore and India – reduce immediate exposure to supply disruptions directly linked to Middle Eastern routes. He also sought to allay public concerns, noting that the country currently maintains sufficient fuel stocks for approximately one month and that there need not be any queueing up by the public to hoard supplies.

However, the analyst cautioned that while physical supply may remain stable, global price pass-through effects are an unavoidable risk.

Meanwhile, Opposition politician Wimal Weerawansa said that official assurances of “one month’s stock” tend to unsettle the public, arguing that such statements evoke memories of past shortages and public distress.

By Sanath Nanayakkare

Business

Ministry of Education recognises LOLC Divi Saviya for restoring 200 schools

Published

16 hours ago

2026/03/2

Sahan Weerasooriya

Kapila Jayawardena, Group Managing Director/CEO of LOLC Holdings PLC presenting the project update of LOLC Divi Saviya to Prime Minister and Education Minister Dr. Harini Amarasuriya

The Ministry of Education officially recognised LOLC Holdings PLC for its flagship humanitarian initiative, Divi Saviya, at a special ceremony held on 27th February 2026 in Battaramulla. The event marked the second time the Ministry has acknowledged the programme’s contribution to the nation’s education sector.

Group Managing Director/CEO Kapila Jayawardena presented a project update to Prime Minister and Education Minister Dr. Harini Amarasuriya, highlighting the rapid restoration of 200 schools under Phase 02 of ‘Obai, Mamai, Ape Ratai’. The schools were repaired and handed over within just 45 days, enabling students displaced by Cyclone Ditwah to safely resume learning.

Phase 02 follows a needs assessment that identified 200 damaged schools and 4,000 displaced families. Implemented with Divisional Secretariats and Disaster Management Centres, the Rs. 500 million programme has delivered Family Super Packs and school renovations across six districts.

Kapila Jayawardena stated, “It was a privilege to share these outcomes with the Prime Minister. This recognition reflects how private sector collaboration can complement government efforts during national challenges.” Plans are underway to fully rebuild select schools destroyed by the cyclone.