Nepal Telecom reports 42% fall in annual profit

16 Aug 2019

State-owned telecommunications provider Nepal Telecom (NT) has reported a 41.6% decline in full-year net profit to NPR10.2 billion (USD10.6 million) for its 2018-19 financial year. Revenue fell 3.9% to NPR43.4 billion and EBITDA 8.7% to NPR24.3 million, with the company attributing the losses to licence renewal fees, foreign exchange effects and falling revenue caused by the popularity of OTT services.

The company highlighted that profit was negatively impacted by a backdated licence fee payment of NPR4 billion, the first of five annual instalments totalling NPR20 billion. NT’s employee trade union has previously argued the fee places a massive financial burden on the company and should be reduced. The operator noted it is expanding its 4G mobile network and fibre broadband services across the country in order to address the challenging business environment.

Meanwhile, Smart Telecom, Nepal’s third largest mobile network operator (MNO), has agreed to pay the NTA NPR300 million of the total NPR2.6 billion it owes in outstanding fees within 15 days, reports The move follows the regulator’s repeated threats to rescind the licence of any operator that fails to pay money owed for licence renewal, spectrum awards and other obligations. The regulator has likewise given local wireline operator Nepal Satellite Telecom until 18 August to pay NPR70 million or risk having its licence revoked, according to The Himalayan Times. The company owes almost NPR1 billion in outstanding fees.