Orascom Posts 66 % Drop in Net Profits for Q1 – 2009

Orascom Telecom posted a 66 percent drop in first quarter net profit to $72 million. Orascom, headed by Egyptian billionaire Naguib Sawiris, said its net revenue dipped 4 percent to $1.197 billion, citing currency devaluations versus the U.S. dollar in key markets.

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Financial statement released by the company showed that Mobilink’s customer base decreased in Q1 09, the number of inactive customers was reduced. Report says that In Q1 09 Mobilink focused its commercial efforts on activating the market float rather than accelerating the sales of new SIMs. This resulted in a lower dormant base, and a corresponding increase in 30 days calling base, and a slowdown in gross adds, offset by a positive impact on SAC. Trends in April and May show a revival of net additions following the reduction of the dormant subscriber base in Q1 2009.

Following graph represents very interesting data. We are familiar with the most of stats represented in it, but the amount of postpaid customers. I guess this is first time, any operator has made public the number of postpaid subscribers (correct me if i am wrong). Moreover, you may see that postpaid subscribers didn’t show the same ratio of decrement over the time as the prepaid base. Moreover, Mobilink has controlled the churn rate, which was almost double in previous quarter.

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Let’s look into following graphs for ARPU level of Mobilink and other Orascom subsidries

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ARPU dropped slightly in local currency, despite low churn.

Moreover, Orascom report covers that in Pakistan Mobilink remains market leader but its share declined 0.8 percent. Orascom has boldy described this drop as certain competitors are not applying strict churn policy. Moreover, this drop is due to very aggressive price promotions by competitors – while Mobilink’s market share as measured internally on traffic patterns remains above 40%, disclosed by report.

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Capital expenditures in the first quarter of 2009 were substantially lower than the corresponding period of 2008 mainly as a result of the implementation of OTH’s simple free cash flow boost program which entails a reduction in investments in Pakistan and Bangladesh.

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Mobilink’s Q1 – 2009 Summary Reportmobilink_top

Tech reporter with over 10 years of experience, founder of ProPakistani.PK