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Sri Lanka Telecom net profit drops 74% on costs; telco invests in northern link

16 Nov 2009

Announcing its financial results for the nine months ended 30 September 2009, Sri Lanka Telecom (SLT) revealed that its consolidated revenues rose by 2% year-on-year to LKR35.9 billion (USD314 million) whilst its group net profit plunged by 74% to LKR1.2 billion, caused by increases in depreciation, operational costs, finance costs and income tax liabilities at cellular unit Mobitel due to the expiry of a Board of Investment ‘tax holiday’. The company said ADSL fixed broadband turnover for the period grew by 12%, partly offsetting the ongoing decline in traditional PSTN sales. Mobitel increased its mobile subscriber base by 42% year-on-year to 3.2 million at the end of September 2009, whilst the cellco’s revenues in the first three-quarters of 2009 were 34% higher than the corresponding period of 2008.

In related news, SLT is investing LKR3.5 billion in a fibre-optic link along the A9 road connecting to the far north of the country. The north-south highway is expected to be reopened to civilians soon following the military defeat of northern rebels in May, in a government move aimed at signifying the island’s reunification. Greg Young, CEO of SLT, said: ‘There’s obviously a lot of commerce reopening in the northern areas. We are seeing very substantial calling patterns by customers.’

Sri Lanka, SLT-Mobitel, Sri Lanka Telecom (SLT-Mobitel)

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