Telecom Egypt Q3 net profit drops 21pc
Cairo, November 14, 2011
Land-line monopoly Telecom Egypt posted a 21 percent drop in third-quarter net profit on Monday as it continues to suffer the economic fallout of a popular uprising.
The company, which is banking on data services to offset lower fixed-line income, said its net income fell to 622.7 million Egyptian pounds ($104.2 million) from 789.8 million in the same period a year earlier.
Consolidated operating revenues fell 10 percent to 2.35 billion pounds amid continued disruption to Egypt's business environment and seasonal effects of the Muslim holy month of Ramadan, it said.
Egypt's economic slowdown also reduced tourism and cut usage by business customers, hitting international call volume.
"Economic uncertainty, depressed tourism levels and slower business activity have ... created a drag on TE's short term financial performance," said Chairman Akil Beshir in a statement.
"While there has not yet been a return to normal operating conditions in Egypt, we have mitigated these effects to a greater extent than our competitors," he said.
The malaise in Egypt's economy hit household incomes and reduced the number of active Telecom Egypt subscribers.
"We have adjusted active connections accordingly, which has temporarily reduced the number of subscribers we deem as active," said Beshir. - Reuters