Omantel sees drop in H1 net profit as expenses rise 9%

Oman Telecommunications Company (Omantel) generated revenue of OMR223.3 million (USD580 million) in the six months ended 30 June 2011, representing an increase of 2.3% compared to OMR218.4 million reported in the same period a year earlier. The Oman Daily Observer reports that the company’s net profit after tax for the first half of 2011 totalled OMR55 million, down from OMR61 million in the year-ago period, as expenses increased 9.4% year-on-year from OMR149.9 million to OMR164 million. Omantel, which is 70%-owned by the Omani government, attributed the rise in expenses to increased investment in expanding network reach, enhancing the quality of the services and the construction of cable systems. The firm said that the employment of 200 new employees and the improvement of employee benefits were the second major driver of the increase in expenses. On a quarterly basis, Omantel’s Q2 net profit after tax was flat at OMR28.9 million, but increased from OMR26 million in the first three months of 2011. At 30 June 2011 Omantel had a total of 3.348 million customers (an increase of 3.2% year-on-year), including 274,000 broadband customers. The results are preliminary and subject to approval from the Board of Directors.