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Dialog Axiata swings to Q4 and full-year profit, reveals USD150m expansion

14 Feb 2011

Sri Lanka’s largest cellular operator by subscribers, Dialog Axiata, has reported net profits of LKR1.275 billion (USD11.5 million) in the three months to the end of December 2011, compared to a net loss of LKR2.2 billion a year earlier, although lower than the LKR1.69 billion profit recorded in the previous quarter. For the full-year, consolidated net income reached LKR5.0 billion, compared to a loss of LKR12.2 billion in 2009. Dialog’s previous financial losses were attributed to the group’s ventures in the fixed broadband and pay-TV segments, where its units have taken longer to see a return on investment than was previously anticipated; revenue erosion from fierce competition in Sri Lanka’s mobile market was also a factor. The Malaysian-backed company said that the slight dip in quarter-on-quarter profit in 4Q10 was due to a foreign exchange gain in the July-September period and some accounting adjustments in the fourth quarter, whilst ‘underlying revenues were growing steadily and costs were contained.’ In core mobile operations, revenues rose to LKR9.8 billion in October-December 2010, up from LKR9.67 billion in the preceding three months, and compared to LKR8.9 billion a year earlier. Dialog also announced it reached 7.0 million mobile subscribers at the end of December 2010, up from 6.4 million twelve months earlier.

Dialog also said that it will invest USD150 million to expand its networks, bringing the total foreign direct investment by the firm to USD1.2 billion. Its head, Hans Wijayasuriya said the new investment will go into areas including strengthening its broadband and fibre-optic network coverage. ‘We will focus a lot of [the investment] in broadband, mobile broadband as well as fibre-optics … We want to make our products available seamlessly across the country,’ Wijayasuriya stated.

Sri Lanka, Dialog Axiata

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