Telecom Egypt reports sizeable decline in net profit in 1Q18 despite increased revenues

12 May 2018

Telecom Egypt (TE) recorded a 15% year-on-year increase in revenues in the opening quarter of 2018, with the company reporting a turnover of EGP4.782 billion (USD6.5 billion), driven by a strong level of growth in revenue from retail services. Indeed, ‘Home and Consumer’ turnover was up by 45% y-o-y in 1Q18 at GBP1.829 billion, while ‘Enterprise’ revenues rose by 13% to EGP624 million. EBITDA, meanwhile, was EGP1.506 billion, representing an annualised increase of 9%, but net profit after tax (NPAT) totalled EGP688 million, down significantly from EGP1.326 billion in 1Q17.

With regards to operational key performance indicators, TE reported a broadband subscriber base of 4.366 million for the end of March 2018, up 29% y-o-y, which it says is equivalent to a market share of 79%. Fixed voice accesses were also up, reaching 7.265 million at the end of the quarter, from 6.630 million in 1Q17. Meanwhile, the telco’s foray into the mobile sector appears to be off to a solid start; having launched commercial services in September 2017, by the end of 1Q18 the company had signed up 2.930 million wireless subscribers, up from 2.300 million at end-2017.

Ahmed El Beheiry, Group Chief Executive, said of the company’s performance in 1Q18: ‘I am very pleased with the achievements we made this quarter, which put us on track to deliver on our business objectives and meet our guidance for the full year. This quarter’s KPIs demonstrate the company’s ability to sustain operational growth reflected in a double-digit growth in revenue, and a high single-digit growth in EBITDA.’

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