Telecom Egypt Reports Q1

Egyptian carrier reports net profit increased 22% to EGP585M, or EGP0.34 per share

May 15, 2007

2 Min Read

CAIRO, Egypt -- Telecom Egypt (TE) (Ticker: ETEL.CA; TEEG.LN), today announced its consolidated financial results for the three months ending 31 March, 2007. Financial statements have been prepared in accordance with Egyptian Accounting Standards.

Highlights for the three months ending 31 March, 2007 include:

  • Revenues reached EGP 2.4 billion, an increase of 9% on 1Q 2006

  • EBITDA after provisions reached EGP 1.35 billion, up from EGP 1.25 billion in 1Q 2006

  • EBITDA margin for the period was 56.9%

  • Net profit increased 22% to EGP 585 million

  • Earnings per share (EPS) increased 22% from 1Q 2006 to EGP 0.34

  • Monthly ARPU increased 1% to EGP 55.4

  • Capex related cash flows reduced by 23% year-on-year to EGP 265 million

  • 10.9 million fixed-line subscribers, up 4% on 1Q 2006

  • Fixed line penetration reached 15%

  • 186% growth in ADSL subscribers versus 1Q 2006 – 46.5% retail ADSL market share

Chairman’s statement

Commenting on Telecom Egypt’s first quarter 2007 results, Eng. Akil Beshir, Chairman and CEO of Telecom Egypt, said:

“After what was an exceptional performance in the final quarter of 2006, I am greatly encouraged by a solid start to the year. When compared with the first quarter of 2006, the effects of our tariff rebalancing programme can again be seen especially in subscription revenues. This has contributed to a 9 percent increase in revenue in the first quarter of 2007 relative to the comparative period in 2006.

“The growth in demand from other operators to connect to our extensive network has again given rise to a healthy quarterly result from our wholesale services, which now represent 31 percent of our total revenue mix. Wholesale revenues were up 19 percent on this time last year and represent a key commercial opportunity for TE in the remainder of 2007.

“Furthermore, with both ARPU and EBITDA metrics showing minor increases, but more importantly stability, I believe we are well positioned for another successful year.

“Our retail Internet business, TE Data, continues to make inroads into the retail ADSL market, having achieved a 46.5 percent market share by the end of the first quarter. Its ADSL subscriber base has already grown 20 percent in the first three months of the year; 186 percent since 31 March 2006. The technical ability and service excellence of the TE Data team, combined with a desire to grow the market as well as their share in it, means we are confident that during 2007 we will further cement our position as the broadband market leader.

“Aside from the wholesale revenues contribution I mentioned above, TE continues to derive substantial benefit from the sustained growth in the mobile market in Egypt from our significant investment in Vodafone Egypt (VE). VE’s performance in the first quarter contributed EGP 243 million to our consolidated results. Crucially, over the last 5 months we have been working closely with VE on the nature of commercial collaboration and I expect to be able to announce the outcome of this cooperation during the second quarter.”

Telecom Egypt

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