24 July 2008
The Kingdom's leading telecommunications company, Batelco yesterday said its net profit for the first half of the year 'dipped slightly' by 2.8 per cent compared to the corresponding period last year. The telecom major earned a net profit of BD50.8 million ($134.7 million), equivalent to earnings per share of 35.3 fils.
The board of directors approved an interim cash dividend of 20 fils per share.
Batelco continued to deliver strong double-digit growth in revenue with gross revenue of BD160.5 million ($425.7 million), a 17.7 per cent increase over the same period of 2007.
"Our half-year results have been impacted by a number of one-off adjustments, which had a negative net impact of BD1.2 million. During the same period in 2007, one-off adjustments had a net positive impact of BD4.7 million. While profit from our operations increased year-on-year, the one-off adjustments contributed to the 2.8 per cent decline in net profits," the Batelco Chief Executive Officer, Peter Kaliaropoulos explained yestreday.
Speaking at Batelco's board meeting yesterday where the half year financial results were announced, Batelco chairman Shaikh Hamad bin Abdulla Al Khalifa said the company continued to grow at home and overseas despite the full impact of deregulation and competition in all the markets where it was present.
"There are now 69 licensed operators in Bahrain and Batelco continues to review its operating strategies in order to retain its market share in the Kingdom. Our customers are constantly demanding quicker, smarter and better value services and we must continue to respond to those demands. Putting our customers as our number one priority has never been more crucial," he said. Kaliaropoulos said that the Batelco Group growth was driven mainly by overseas operations, which now represent 33 per cent of Batelco's revenues. The group's 96 per cent owned subsidiary in Jordan, Umniah, has delivered significant year-on-year revenue growth of 59 per cent buoyed by a 61 per cent increase in the number of mobile subscribers. The customer base there was put at 1,314,000.
Sabafon, in which the Group holds a 26.94 per cent equity investment, delivered a 30 per cent year-on-year growth in revenue with the mobile subscribers base increasing by 16 per cent, for a total customer base of 1,889,000.
"Strong revenue performance has also impacted the Group's cost base, particularly in network operating expenses. Out-payments to other telecom operators increased as a result of significant growth in international traffic minutes, particularly wholesale. Ongoing restructuring of the operations, retrospective charges by the Telecommunications Regulatory Commission in Jordan for interconnect traffic and retrospective custom duty and tax expenses, adjustments to depreciation schedules, bad debt policy, fines imposed by the TRA (Telecommunication Regulatory Authority) Bahrain and expected legal costs and employee redundancy compensation provisions combined with competitive pressures for lower prices, have contributed to higher costs in 2008."
Kaliaropoulos said Batelco was implementing a cost leadership programme in the second half of the year and expects double digit revenue growth for 2008 and the priority remains one of winning market share in all overseas markets, while maintaining market leadership in Bahrain.
Batelco's mobile customer base in Bahrain, Jordan and Yemen reached 3.8 million. In Bahrain, there were 70,000 customers registered to Batelco's broadband services and the total number of telephone lines has steadied at 202,000.
Kaliaropoulos said that a strong performance in the Bahrain market remained critical to Batelco's strategic expansion. "Batelco has been investing overseas for the last three years and now has operations in six Middle East countries reaching some 60 million people. Such expansion is driven by the commercial realities of the Bahrain market and regulatory policy. As a market leader and incumbent operator in Bahrain, it is a natural imperative to seek sizeable acquisitions overseas."
"We are proud of our contribution to the growth and development of the Kingdom by delivering advanced communications technologies which support the Government's ambitious strategy to have more than 90 per cent of Government Ministry transactions carried out online by 2010."
"It is also vital that the regulatory environment enables us to make the necessary investments in the next generation of the Kingdom's communications infrastructure to fully support such major infrastructure initiatives which will lure overseas investors to make Bahrain their first and friendlier choice for business in the Middle East."
As part of the Etihad Atheeb consortium Batelco staff based in Saudi Arabia were currently making final preparations to ensure the delivery of wireless broadband, data solutions and voice services by the end of the fourth quarter this year.
"Major contracts worth over $300 million have been signed by the consortium with industry leading companies and plans are in place for further substantial investments over the next five years, to deliver the relevant technologies necessary for the success of the venture." The consortium was currently awaiting the approval of the Capital Market Authority in Saudi Arabia to go ahead with an IPO.
As a part of its corporate social responsibility role, it committed over BD2 million through donations and sponsorships.
The Kingdom's leading telecommunications company, Batelco yesterday said its net profit for the first half of the year 'dipped slightly' by 2.8 per cent compared to the corresponding period last year. The telecom major earned a net profit of BD50.8 million ($134.7 million), equivalent to earnings per share of 35.3 fils.
The board of directors approved an interim cash dividend of 20 fils per share.
Batelco continued to deliver strong double-digit growth in revenue with gross revenue of BD160.5 million ($425.7 million), a 17.7 per cent increase over the same period of 2007.
"Our half-year results have been impacted by a number of one-off adjustments, which had a negative net impact of BD1.2 million. During the same period in 2007, one-off adjustments had a net positive impact of BD4.7 million. While profit from our operations increased year-on-year, the one-off adjustments contributed to the 2.8 per cent decline in net profits," the Batelco Chief Executive Officer, Peter Kaliaropoulos explained yestreday.
Speaking at Batelco's board meeting yesterday where the half year financial results were announced, Batelco chairman Shaikh Hamad bin Abdulla Al Khalifa said the company continued to grow at home and overseas despite the full impact of deregulation and competition in all the markets where it was present.
"There are now 69 licensed operators in Bahrain and Batelco continues to review its operating strategies in order to retain its market share in the Kingdom. Our customers are constantly demanding quicker, smarter and better value services and we must continue to respond to those demands. Putting our customers as our number one priority has never been more crucial," he said. Kaliaropoulos said that the Batelco Group growth was driven mainly by overseas operations, which now represent 33 per cent of Batelco's revenues. The group's 96 per cent owned subsidiary in Jordan, Umniah, has delivered significant year-on-year revenue growth of 59 per cent buoyed by a 61 per cent increase in the number of mobile subscribers. The customer base there was put at 1,314,000.
Sabafon, in which the Group holds a 26.94 per cent equity investment, delivered a 30 per cent year-on-year growth in revenue with the mobile subscribers base increasing by 16 per cent, for a total customer base of 1,889,000.
"Strong revenue performance has also impacted the Group's cost base, particularly in network operating expenses. Out-payments to other telecom operators increased as a result of significant growth in international traffic minutes, particularly wholesale. Ongoing restructuring of the operations, retrospective charges by the Telecommunications Regulatory Commission in Jordan for interconnect traffic and retrospective custom duty and tax expenses, adjustments to depreciation schedules, bad debt policy, fines imposed by the TRA (Telecommunication Regulatory Authority) Bahrain and expected legal costs and employee redundancy compensation provisions combined with competitive pressures for lower prices, have contributed to higher costs in 2008."
Kaliaropoulos said Batelco was implementing a cost leadership programme in the second half of the year and expects double digit revenue growth for 2008 and the priority remains one of winning market share in all overseas markets, while maintaining market leadership in Bahrain.
Batelco's mobile customer base in Bahrain, Jordan and Yemen reached 3.8 million. In Bahrain, there were 70,000 customers registered to Batelco's broadband services and the total number of telephone lines has steadied at 202,000.
Kaliaropoulos said that a strong performance in the Bahrain market remained critical to Batelco's strategic expansion. "Batelco has been investing overseas for the last three years and now has operations in six Middle East countries reaching some 60 million people. Such expansion is driven by the commercial realities of the Bahrain market and regulatory policy. As a market leader and incumbent operator in Bahrain, it is a natural imperative to seek sizeable acquisitions overseas."
"We are proud of our contribution to the growth and development of the Kingdom by delivering advanced communications technologies which support the Government's ambitious strategy to have more than 90 per cent of Government Ministry transactions carried out online by 2010."
"It is also vital that the regulatory environment enables us to make the necessary investments in the next generation of the Kingdom's communications infrastructure to fully support such major infrastructure initiatives which will lure overseas investors to make Bahrain their first and friendlier choice for business in the Middle East."
As part of the Etihad Atheeb consortium Batelco staff based in Saudi Arabia were currently making final preparations to ensure the delivery of wireless broadband, data solutions and voice services by the end of the fourth quarter this year.
"Major contracts worth over $300 million have been signed by the consortium with industry leading companies and plans are in place for further substantial investments over the next five years, to deliver the relevant technologies necessary for the success of the venture." The consortium was currently awaiting the approval of the Capital Market Authority in Saudi Arabia to go ahead with an IPO.
As a part of its corporate social responsibility role, it committed over BD2 million through donations and sponsorships.
© Bahrain Tribune 2008
