DIGI - Annual Report 2021

Financial Capital Disciplined cost management to support growth and modernisation initiatives Leveraged rising internet and digital adoption Enhancement in digital payments and affordable product offerings to drive cost efficiencies Total Cost  Optimised cost allocation to prioritise modernisation initiatives in improving overall customer experiences  Overall cost increase mainly driven by higher handset sales reflecting strong growth of Postpaid segment Internet users’ expansion 4G subscribers  Completion of 3G network shutdown in January 2022 in line with JENDELA initiative enabled 3G spectrum to be refarmed to improve the network performance of 4G, contributing to more 4G subscribers and higher smartphone penetration rate • Voice over LTE (VoLTE) traffic increased from 24% in FY2020 to 56% in FY2021 Levers for improving ECL ratio:  Continued digitalisation to increase touch free digital payment methods drove solid collections during the year  Combination of seamless customer journey and affordable, flexible products proved to be an effective strategy in customer retention and curtailing delinquencies  Digi recorded lower expected credit loss (ECL) of RM55 million (RM82 million in FY2020) flowing through to a lower ECL ratio of 2.2%, alongside stronger free cash flow supported by robust collections Prudent CAPEX allocation  Prioritised investments to sustain network leadership and drive digital capabilities  Disciplined capital allocation to support JENDELA  Cost of goods and services (COGS) grew 14% YoY mainly due to growth in device and digital businesses  Operating expenditures (OPEX) to service revenue ratio for the full year remained healthy at 29.5%  Modest OPEX growth of 2.5% mainly driven by network expansion 3,073 3,327 +8% FY2020 FY2021 COGS (RM’mil) OPEX (RM’mil) 1,534 1,539 1,573 1,754 773 815 +5% FY2020 FY2021 Optimal organic CAPEX (RM’mil) Asset retirement obligation (RM’mil) 720 53 803 12 Sustained Total CAPEX- to-Total Revenue Ratio CAPEX allocation for network modernisation Support growing network coverage and digital enhancement (FY2020: 12.6%) Part of our modernisation journey to drive efficient rollouts of 4G, in line with national digitalisation agenda +12.9% > 65% How We Create Value FY2020 FY2019 2.8% 3.2% 2.2% FY2021 ECL ratio 3.5 3.0 2.5 2.0 Increasing digital payment solutions Affordable and flexible products 85% 87% +2% FY2020 FY2021 Smartphone penetration rate 87% 92% +5% FY2020 FY2021 52 Digi.Com Berhad At A Glance Message To Shareholders How We Create Value Strategies To Create Value

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