Revenue Grows by 7.5% to R.O 256.6 Million and Net profit Reaches R.O 61.3 Million
Omantel declares an interim dividend of 55% of paid up capital
Oman Telecommunications Company S.A.O.G (Omantel. MSM: OTEL), revealed today the Company’s preliminary unaudited financial results for the 2nd Quarter ended on 30th June 2015. Group revenue recorded a growth of 7.5% to R.O 256.6 million compared with R.O 238.6 million in the corresponding period of 2014, while the net profit has reached R.O 61.3 million compared to R.O 65.9 million in 2014. Expenses for the period have increased by 12.7% to R.O 190.6 million from R.O 169.1 million in 2014.
Omantel said that growth was mainly driven by Domestic retail revenues which have recorded a growth of 8.3% and now reached RO 253 million compared to RO 233.6 million for the corresponding period of year 2014 mainly contributed by both fixed & mobile broadband and wholesale services. All major segments – Consumer, Corporate and Wholesale revenues have recorded a growth over last year.
Group Operating expenses increased by 12.7% to RO 190.6 million compared to RO 169.1 million for the corresponding period of year 2014. The major reasons for increase in operating expenses are attributed to increase in roaming, operating & maintenance (O&M), depreciation, employee costs, marketing cost and administrative expenses. The increase in O&M and depreciation are the result of increased investment in network modernization / expansion for both mobile and fixed networks to meet the growing demand of broadband services as well as increase in costs related to submarine cable capacity IRU sales, cost of devices etc.,. Administrative costs include RO 1 Mn towards penalty imposed by TRA on account of network outage in November14 in addition to consultancy costs related to new Corporate Strategy and Spend optimization initiatives, which are of non-recurrent nature.
The Group recorded a net profit of RO 61.3 Mn in the 2nd quarter of 2015 compared to R.O 65.9 million in this same period of 2014. Decline in net Profit is mainly due to loss incurred by Omantel’s subsidiary Worldcall. Also, increase in domestic Opex mainly of non-recurrent nature also impacted the domestic net profit for the quarter. Domestic Net profit decreased by 2.5% to RO 66.9 million compared to RO 68.6 million in the corresponding period of 2014.
Broadband segment both Mobile and Fixed Broadband services have been the key driver for the growth. Mobile and Fixed Broadband subscribers grew by 12% and 30%.
Omantel domestic subscriber base witnessed a growth of 3% as of 30th June 2015 reaching 3.329 million (excluding mobile resellers).
Based on the authorization of the AGM in March 2015, the Board has decided to distribute interim dividend of 55% of the paid up capital (55 bz per share) to shareholders registered on 31 August 2015.
Additional Spectrum on 800 / 2600 Mhz
Omantel has acquired additional spectrum in 800 and 2600 Mhz to enhance its mobile Broadband service offerings for RO 7.7 Mn. This is expected to boost the deployment of LTE and enable the Company to have wide coverage of LTE services across the Sultanate resulting in improved quality of broadband services.
Commenting on the results, Omantel Chief Executive Officer, Talal bin Said Al Mamari said: “Omantel has continued to see a steady growth especially in the revenue despite the decline of net profit due to the existence of some non-recurrent expenses during the quarter”.
“The first half of 2015 recorded a very good growth in our mobile and fixed broadband customer base, a trend that we are expecting to continue and become a significant contributor to our growth for years to come" Al Mamari added.
“I would like to thank our loyal customers, visionary Board, committed employees and supportive shareholders who have always been part and in support of Omantel’s journey to excellence” Talal Al Mamari concluded.