Sri Lanka Telecom Q1 Profits Down

COLOMBO, Sri Lanka -- The SLT group continues to make profits in the midst of challenging economic conditions.

“In spite of the adverse economic scenario and gloomy financial conditions prevailing worldwide, SLT has been able to show resilience to weather the storm and bring about performance.” Mrs. Leisha De Silva Chandresena, Chairperson of the SLT Group commented.

Owing to its strength and resilience to turbulent market conditions, the integrated telecommunication services provider, SLT was able to announce favorable results for its first quarter of the financial year ending 31st March 2009. The Group has achieved a net profit of Rs. 971 million during this quarter. The achievement was 42% below, the same quarter compared to that of the previous year due to the increase of operational expenditure and depreciation. Thus, the company achieved a net profit of Rs.734 million, a reduction of 46% compared to the corresponding quarter of the previous year as a result of revenue reductions.

During this quarter the group revenue was Rs. 11,837 million, 2% higher than the 1st quarter of 2008. Thus, the company level revenue had dropped by 11% to Rs. 8,392 million.The company’s strategy of developing the non-voice business sectors which is also consistent with the Government policy on ICT continued with the development of internet and data oriented services. Due to various innovative strategies such as the introduction of affordable packages for customers, expansion of the infrastructure facilities and augmenting improvements to the quality of service rendered, SLT has become a trend setter and recorded the largest share in the Broadband and Data Services market. During the quarter, Broadband and Data revenue has grown by 25% to Rs.1,595 million quarter on quarter.

Owing to the prevailing economic conditions, Wired and CDMA subscribers have been compelled to scale down usage while some customers have migrated to other fixed and mobile networks seeking budget price packages. As a result, these adverse conditions have brought down the Wired and CDMA revenue by 19% and 18% respectively. Various taxes and levies imposed on fixed services by the Government has further aggravated this problem and put much pressure on customers to be more conscious about scaling down usage.

Pressure from global recession has had an impact on international telecommunication traffic and pricing. These combined with emerging competitors, has brought down international revenues by 15% to Rs. 1,980 million.

Sri Lanka Telecom