Telecom Egypt's net profits fall 15 per cent

Ahram Online and agencies, Monday 15 Aug 2011

Landline monopoly sees sharp yet smaller than expected drops in revenues and profit margins, with some crediting the 'resilience' of the telecoms sector

Telecom Egypt logo
Landline monopoly Telecom Egypt (TE) posted a 15 per cent drop in its second-quarter results, the company said in a statement on Monday.
The firm made 2Q2011 net profits of LE826 million (US$138.8m), down from LE971 million in the same period the year before, and 7.9 per cent less than in the first quarter of 2011.
Revenues fell 3.7 per cent to LE2.61 billion from LE2.71bn for the same period last year, but climbed 8.5 per cent on 1Q2011.
Earnings before interest, taxes, depreciation and amortisation (EBITDA) also dropped to LE1.25bn, recording a margin of 48 per cent. This compared to 51.7 per cent in 2Q2010 and 53.5 per cent in 1Q2011. 
Use of TE's services saw change too, as the number of fixed line subscribers declined to 9 million at the end of June 2011, a 4.3 per cent drop on the previous year. Conversely, ADSL subscribers exceeded 1 million for the first time, showing a 1 per cent quarter-on-quarter increase and an annual climb of 37.3 per cent.
Losses were lighter than many predicted, with a statement from Beltone Financial saying they proved the "relative resilience of the telecommunications sector versus other sectors amidst the current political uncertainty in Egypt."
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