Orascom Telecom’s net profit dips

13 May 2010

Egyptian telecoms firm Orascom Telecom has announced that its net profit dipped in the first quarter of 2010 as a result of heavy start-up costs in Canada and troubles in Algeria. Orascom said the 32% fall in profit, to USD49 million, was also due to an exceptional gain in the same quarter a year ago for the sale of M-Link, a long distance network for voice and data. Revenue at Orascom’s Algerian unit Djezzy, which accounted for one-third of its total revenue, fell to USD412.5 million in the quarter from USD462.5 million a year earlier. Orascom said Djezzy was hit by a new 5% sales tax on mobile recharges and the lingering fallout from attacks on the unit’s headquarters and shops in November after a bitter World Cup qualifying match between Egypt and Algeria. The Cairo-based international mobile network operator is in talks to sell Djezzy plus some sub-Saharan assets to South Africa’s MTN, but the deal has so far been stymied by Algerian resistance. Orascom Telecom posted EBITDA of USD520.9 million on revenue of USD1.22 billion in the first quarter of 2010, an EBITDA margin of 42.8%. Canadian start-up Globalive contributed most of a USD33.7 million associate cost, the firm said. Orascom does not fully incorporate the Wind-branded operation, which launched in December, but holds a 65% indirect stake and minority voting rights.

Egypt, Global Telecom Holding (GTH, formerly OTH)