Batelco net profit rises 11 per cent to BD27.5 million

Manama, Aug.7 (BNA): Batelco, the Bahrain-based company having telecoms operations across 14 countries, has reported an 11 per cent increase in net profit at BD27.5 million ($72.9m) for the first six months of this year, compared with BD24.9m ($66m) for the same period last year.


In a statement, the company said the improvement in profit for the period was mainly due to cost savings this year, increased yield on invested cash and lower interest expense and non-recurrence of adjustments taken last year.

Earnings before interest, taxes, depreciation, and amortisation (EBITDA) for the period was BD69.8m representing a margin of 38pc, compared with EBITDA of BD71.9m for the corresponding period last year, a 3pc decrease year-on-year and 4pc quarter-on-quarter.

Gross revenues for the period showed a decrease, down by 5pc year-on-year and 2pc quarter-on-quarter to BD185.7m from BD194.6m mainly due to competitive pressures in key markets and currency translation.

Operating profit for the period was BD36.1m versus BD39.1m for the corresponding period last year reflecting an 8pc decrease year-on-year and a 6pc decrease from the first quarter this year.

While the operator’s overall subscriber numbers are up by 4pc year-on-year, there has been a marked decline in the customer base in Sabafon, Yemen, since last quarter due to the difficult operating environment in the country, which has negatively impacted profits.

Nonetheless, Batelco’s overseas operations overall remain strong and at the end of the six month period, 59pc of revenues and 56pc of EBITDA were attributable to operations outside Bahrain.
This is compared with 57pc of revenues and 52pc of EBITDA in the first half last year. As of June 30, net assets were BD577.7m with cash balances of BD135.9m.
Earnings per share were 16.6 fils and the board has approved an interim cash dividend of 10 fils per share for the six month period.
Batelco chairman Shaikh Hamad bin Abdulla Al Khalifa said a double-=digit increase in net profit had been recorded during the period, despite the challenging environment in key markets.

“Efforts to improve competitiveness across all operations by leveraging the combined technical capabilities, have contributed to the increase in overall subscriber numbers year-on-year,” he added.

“We continue to operate smartly through synergising efforts. “Accordingly, our operations outside of Bahrain continue to generate over half of our revenues and profits which meets our expectations and efforts to offset the impact of ongoing and aggressive competition at home,” Shaikh Hamad said.

“In keeping with our strategic goals we will continue to invest in building, developing and enhancing infrastructure and services.
“We believe that the progress we are making in improving our competitiveness across all our operations will enable us to deliver improved results for shareholders in the second half of the year,” he added.

The company’s acting chief executive Ihab Hinnawi said it was encouraging to report that customer numbers across the operations continued to grow.

“The subscriber base now stands at 9.4 million customers, a rise of 4pc year-on-year,” he added.
“This reflects gains made over the past year in key markets of Bahrain and Jordan as well as across the majority of the subsidiaries.

“Reduced customer numbers in Yemen are the result of political challenges present in that market,” Mr Hinnawi. “By pooling of group resources, technologies and expertise where possible, we aim to further enhance competitiveness and performance across our network of operations,” added Mr Hinnawi.

In Bahrain, mobile subscribers increased by 2pc year-on-year and by 2pc since the first quarter.”The demand for the latest mobile services is relentless but we meet that challenge by continuously evolving our offers,” Mr Hinnawi added.

“Our choice of bundled packages featuring the latest smart devices with 4G LTE services and at value for money prices strengthens our competitiveness and wins us new customers.”

The company said its broadband customer base has grown by 16pc YoY and by 4pc since the first quarter.
“Broadband packages, delivering speeds of up to 300 Mbps, include options to suit all usage requirements and ensure the continuing popularity of offers,” the chief executive said.

“Crucially, Batelco continues to be the ideal enabler for businesses of all sizes by providing sophisticated technology to fit the needs of this vital segment throughout Bahrain,” he added.
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BNA 0741 GMT 2015/08/07

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