Telecom Egypt records 13% increase in revenue in Q3 2016

11 Nov 2016

Telecom Egypt (TE) has reported ‘another three months of strong financial and operational performance’, with the operator generating a total turnover of EGP3.309 billion (USD372 million), representing year-on-year growth of almost 13%. Residential services accounted for the largest proportion of revenues, standing at EGP1.088 billion, having increased by more than 20% against Q3 2015, with a 41.2% annual increase in data turnover helping offset a 7.2% decline in turnover from fixed voice services. In terms of the revenue contribution from the company’s other units, meanwhile, domestic wholesale services represented 23% of total turnover, followed by international carrier affairs (21%), enterprise solutions (15%) and international customers & networks (8%).

EBITDA for the third quarter of 2016 amounted to EGP921 million, an increase of 16% y-o-y, which TE said was directly attributable to the higher revenues in its higher margin retail business. The EBITDA margin for the quarter under review was 27.8%, in line with management expectation. However, TE’s consolidated net profit after tax (NPAT) in Q3 2016 declined by 27.8% y-o-y to EGP868 million, with this said to be due to higher costs and income tax base, specifically a EGP663 million deferred tax liability reversed in 3Q15 on account of undistributed dividends for associates.

In operational terms, TE claimed to end the quarter with a retail ADSL market share of 76%, having seen net adds of 172,000 accesses in the period under review. As a result of such gains, as at 30 September 2016 TE’s residential broadband subscriber base totalled 3.167 million, up from 2.465 million a year earlier, while enterprise ADSL accesses numbered 187,000 at the end of the quarter, up from 161,000 at end-September 2015.

Commenting on the results, TE CEO Tamer Gadalla was cited as saying: ‘Total consolidated revenues in the third quarter grew 12.8% year-on-year, in line with the growth reported so far this year. This continues to be powered by demand for our retail data services and the strength of our wholesale service proposition.’ Meanwhile, with regards to the company’s plans for the wireless sector, having acquired a 4G concession in September 2016, the executive added: ‘We now look to the future, to 2017 and beyond, and focus on our efforts to build a successful mobile proposition. Our commercial preparations are advancing well and our technical team has made significant progress in laying the foundations needed as we await the spectrum from the Egyptian authorities. I look forward to providing further updates when we report year-end [results].’

Egypt, Telecom Egypt