Omantel Q1 net profit down on rising expenses

Oman Telecommunications Company (Omantel) has announced it generated revenue of OMR111.5 million (USD289 million) in the first quarter of 2011, representing an increase of 0.8% compared to the OMR110.6 million reported in the corresponding period a year earlier. The Times of Oman reports that Omantel’s net profit after tax for the three-month period dropped 18.7% year-on-year from OMR32.4 million to OMR26 million, while operating expenses rose 10% from OMR75.2 million to OMR82.7 million over the same period. The company said it has made large scale investments in the development and enhancement of its network and in particular the introduction of a next generation network (NGN) and the rollout of 3.5G infrastructure. ‘We have continued to make significant investments in our networks to ensure that we meet the needs of our individual consumers and to fulfill the obligations of service level agreements we signed with government institutions and major corporate customers,’ commented Omantel’s CEO, Amer Awadh Al Rawas, adding: ‘We are happy with these results which were made in very challenging conditions, as the competitor [Nawras] launched its fixed and international gateway services, in addition to the increase in expenses mainly driven by depreciation resulting from heavy expansions made on our fixed and mobile networks.’ At 31 March 2011 Omantel’s subscriber base amounted to 3.258 million.