Bahrain Telecommunications Co (Batelco), a leading telecom group with operations across 14 countries, posted a 33 per cent fall in first-quarter profit on Thursday as its subscriber base and revenue both declined.

Batelco made a net profit of BD9.6 million ($25.46 million) in the three months to March 31, it said in a statement. This compares with a profit of BD14.2 million a year earlier.

Batelco reported gross revenues for the period of BD90.9 million ($241.1 million), a 3 per cent and 2 per cent decrease year-over-year and over the previous quarter respectively. Revenues continue to be impacted by competitive pressure in a number of markets across the Group.

EBITDA for the period was BD35.1 million ($93.1 million), representing a margin of 39 per cent.  Despite a 1 per cent decline from the previous year, EBITDA increased by 13 per cent from the previous quarter.  Throughout the period, the Group was able to continue its successful cost containment programmes resulting in a 5 per cent reduction in expenditure compared to the same period last year and an 11 per cent reduction from the previous quarter. The Group continues to sustain its robust EBITDA margin.

The Group’s balance sheet remained strong with net assets of BD555 million ($1,472.1 million) and substantial cash and bank balances of BD174.1 million ($461.8 million). Earnings per share for the first quarter of 2016 are 5.8 fils.

Batelco Group chairman Shaikh Hamad Bin Abdulla Al Khalifa said: “We continue to operate in challenging markets but are encouraged by the strength of the Group as a whole and we believe that by continuing to pool Group resources, technologies and expertise we can enhance competitiveness and performance. We continue to work on restructuring programmes throughout the Group with the aim of reducing operating costs and boosting efficiency and competitiveness as evidenced by the reduction in operating expenses.”

Batelco Group CEO Ihab Hinnawi said that while the overall customer base was down by 8 per cent when compared with Q1 of 2015, a number of the Group’s operations performed very well and showed marked increases in customer numbers.

“It is pleasing to note that our Maldives operator Dhiraagu posted YoY increases in mobile and broadband customers of 10 per cent and 17 per cent respectively. The companies operating under the SURE brand in the Channel Islands, Isle of Man and in the South Atlantic and Diego Garcia also performed well, with their mobile and broadband customer bases increasing year over year,” he said.

“We have a number of Group-wide initiatives in place as well as programmes specific to each geographic location and we anticipate that these efforts will boost performance across the Group going forward. In general our companies operate in very competitive market places as the communications industry today is amongst the most challenging of all industries due to its dynamic nature.

“To meet the unrelenting market challenges that we face we need to constantly adapt and look to new revenue drivers. Keeping all our customers connected with world class communications solutions, no matter how far away they are from our HQ, is crucial and among our key goals,” Hinnawi added.

Hinnawi continued by stating that in Bahrain, despite aggressive competition, Batelco maintained a steady presence in the mobile market supported by its retention of high value post-paid residential and business customers.

“For the period, mobile subscribers in Bahrain remained steady over the previous quarter with a slight decline year-on-year. The Broadband subscriber growth year-over-year was pleasing with customer numbers up by 8 per cent mainly due to the growing popularity of Batelco’s TV and other value added services.”

“Demand for Batelco’s broadband services grew YoY as a result of Batelco’s continuous investment in its fibre network to reach new developments and replace out of date infrastructure across Bahrain,” said Hinnawi.

“Our customer centric strategy designed to ensure we meet the needs of our customers across all sectors is making good progress. We are now focussed on a commitment to develop relevant new digital solutions that will benefit all customers, with an emphasis on supporting the growing needs of the business sector in line with our role as Bahrain’s leading business solutions provider.”


“We have already laid the foundations for digital solutions and will continue to build on our strong base by developing our portfolio in-house and if required by forging partnerships with other organisations or by the acquisition of an ICT unit. Cloud capabilities, OTT TV services, fibre to the home and the delivery of superfast broadband are also areas we are tightening our focus on during 2016,” Hinnawi added. – TradeArabia News Service & Reuters