Telcos Sent $176 million Profits Back To Headquarters During 2015-16

Multinational telecommunication companies, mainly the cellular operators, sent back $176.2 million profit to the countries of their headquarters during the closing financial year 2015-16, according to the data provided by State Bank of Pakistan (SBP).

The telecom sector earnings — that were sent back to their respective countries — is the second highest after financial sector (mainly banks and insurance companies) that sent a handsome amount of $531 million in the same period.

However, the profit repatriation of the telecom companies has dropped by 31.8 % as compared to previous financial year of 2014-15, during which telcos had remitted $258.6 million.

The reduction of the profit was recorded mainly due to investments made by cellular operators in Pakistan from their earnings which is also called as reinvestment of revenues in the operating market.

According to Economic Survey of 2015-16, the estimated revenues of telecom sector stood at Rs 332 billion in three quarter that ended March 31st, 2016 as compared to Rs. 449 billion during four quarters of 2014-15

The decline in revenues is in line with the international trend of profitability and revenues in telecom industry, the report had mentioned.

Moreover a declining trend in revenues of telecom operators was also observed due to loss of millions of cellular subscribers after BVS Re- verification process and intense competition and low tariffs.

After the launch of 3G and 4G services, cellular operators are challenged by Over-The-Top (OTT) services which provide alternate channels through apps for customers to make free chats, voice and video call services.

It is pertinent to mention here that telecom sector’s continued to invest in Pakistan as collectively injected $210.4 million during the outgoing financial year.

Overall, the multinational companies and local companies with foreign shareholding repatriated $1.91 billion to the different countries in the financial year 2015-16 which is 16.7 % ($275 million) higher than previous year in which the amount stood at $1.637 billion.

  • Soooo …… this means what they paid in licence fee they can earn back in few years and then the next 10 yrs is all profits (based on the profits only….of over 250mUSD per year.)…… wish we had our own companies or some that had local partnerships…….. if one Pakistani ppl were good honest managers/leaders..(which they will not be in the next 50 years)

  • close