DUBAI: Bahrain Telecom-munications Co (Batelco) posted a 22.4 percent drop in second-quarter profit yesterday, according to calculations, hurt by continued intense competition in core markets and one-off adjustments.
The former monopoly made a net profit of BD10.4m ($27.6m) in the three months to June 30, down from BD13.4m in the year-earlier period.
Batelco didn’t provide a quarterly breakdown so Reuters based its calculations on its first-half financial statement.
The firm also has not provided details of the one-time cost it incurred beyond referencing it in the first-half statement, while heavy competition has been impacting its earnings for a number of years — this was the 17th quarter in the last 20 in which it has reported declining profit.
In Bahrain, its core market, Batelco competes with units of Kuwait’s Zain and Saudi Telecom Co as well as about 10 Internet providers.
Seeking to offset declining domestic profit and revenue, in April 2013 Batelco completed the $570m purchase of Cable & Wireless Communications’ Monaco and Islands Division, although some of this deal subsequently fell foul of regulators.
Batelco also owns Jordanian telecoms operator Umniah, 27 percent of Yemeni mobile operator Sabafon, minority stakes in internet providers in Kuwait and Saudi Arabia and is also active in Egypt. In total, the firm earned 57 percent of its revenues outside of Bahrain in the first half of 2014, a figure which helped the firm offset “the impact of ongoing and aggressive competition at home,” according to Shaikh Hamad bin Abdulla al Khalifa, chairman of Batelco.
Reuters
