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2018 Winter Olympics and FIFA World Cup set to boost Astro’s adex this year

Astro’s sluggish advertisement expenditure (adex) is set to see improvements in financial year 2019 (FY19) due to two prominent sporting events this year, the PyeongChang 2018 Winter Olympics and the 2018 FIFA World Cup, according to Borneo Post. 

The report, which quoted the latest guidance by AmInvestment Bank, said the bank is forecasting that Astro will see a 3% growth in TV adex and a 7% growth in radex in FY19.

It believes these two major sporting events would “uplift Astro’s adex significantly because they are far more enthralling compared to the notable events in 2017, the SEA Games and Merdeka Celebration.”

The two figures above are estimated based on the bank’s historical checks which revealed – Astro’s TV adex grew by 7% year-on-year (yoy) and 39% quarter-on-quarter (qoq) during the quarter that the 2014 FIFA World Cup was held. The group’s radix also expanded by 8% yoy and 35% qoq, said the bank.

Apart from that, the bank also said the two sporting events this year, will incentivise more user spending on Astro’s NJOI, its non-subscription based satellite TV, which its current average revenue per user (ARPU) stands at approximately RM2 per month. Fees with different packages will be charged accordingly for users who would like to tune in to FIFA-streaming channels, Astro Supersport and Supersport 2.

AmInvestment Bank concluded that among all other aspects that would contribute to Astro’s earnings this year, its overall prospects are set to be improving for FY19, especially with stronger “operational efficiencies from the group’s digitalisation initiatives.” The bank added it’s now optimistic of the Astro’s long-term prospects.

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