Pakistan Telecommunication Company Limited (PTCL), the country’s leading telecom and ICT services provider, has announced its financial results for the quarter ended March 31, 2022, at its Board of Directors’ meeting held in Islamabad on April 13, 2022.
PTCL has reported an increase of 10.51 percent in its profits during the period. According to a notification to the Pakistan Stock Exchange (PSX), the company reported a profit of Rs. 1.90 billion in 1Q2022 as compared to a profit of Rs. 1.72 billion in the same period last year.
During the first quarter of 2022, PTCL Group successfully managed to keep the topline growth momentum, which has further strengthened its market standing as an integrated telecom services provider in Pakistan.
PTCL’s revenue had increased by 3.5 percent to Rs. 19.6 billion from Rs. 18.83 billion in the same period last year, mainly driven by growth in Broadband and Corporate revenue segments.
Growth in revenue is mainly driven by strong performance in the consumer segment led by Fixed Broadband, Mobile Data, Business Solutions, and Microfinance services that supported the Group in achieving 3.2 percent growth in revenues over the comparative period despite the challenges of the increase in Advance Income Tax (AIT) and reduction in Mobile Termination Rates (MTR).
The company has posted an operating profit of Rs. 1 billion for the quarter. Operating profit for the period remained under pressure compared to last year mainly due to an increase in operating costs on account of a significant hike in power tariffs.
An increase in non-operating income, due to translation gain on the Company’s forex denominated assets, dividend income from a subsidiary, and gain on disposal of obsolete assets due to upgrade and fiberization of the network, has helped turn the 39 percent decrease in operating profit level to a 10 percent increase at the net profit level.
Earnings per share of the company clocked in at Rs. 0.37 from Rs. 0.34.
PTCL Group
PTCL Group has reported a loss of Rs. 1.55 billion. It had reported a profit of Rs. 1.60 billion in the same period last year. The Group’s profitability remained under pressure due to a significant hike in power tariffs, devaluation of the Pak Rupee against USD, higher interest rates, and other factors like upfront costs associated with the acquisition of the 4G spectrum and related network rollout.
However, it reported a revenue of Rs. 35.1 billion in Q1, 2022 is 3.2 percent higher as compared to the same period of last year.
During the past quarters, PTCL mainly focused on enhancing customer experience by providing the fastest and most reliable internet services under its flagship ‘Flash Fiber’ Fiber-To-The-Home (FTTH) brand. Through an aggressive and robust commercial strategy, PTCL managed to expand its FTTH services in 27 cities with a capacity enhancement for 125,000 new lines during the past year. The rapid rollout of FTTH and strong performance in the corporate segment ensured PTCL’s topline growth.
Ufone
PTML’s (Ufone) revenue grew by 1 percent YoY as compared to Q1, 2021. U Bank continued its growth momentum and has achieved a 13 percent growth in its quarterly revenue over the same period of last year. The revenue growth is backed by new products, services and 4G upgrades. Ufone has shown higher growth of 42 percent than the industry in 4G data subs for the same period, backed by spectrum acquisition.
PTCL Consumer Business: Steady Performance
In 2022, the company’s Fixed Broadband business grew by 10.4 percent YoY, whereas the IPTV segment also showed a 9.3% growth YoY. Within the Broadband business, Flash Fiber, the company’s premium FTTH service, showed significant growth of 86.6%. The Company achieved the highest ever Fixed Broadband sales in Q1, 2022 since 2015. The Voice revenue stream has seen a decline due to lower voice traffic and continued conversion of customers to OTT services.
PTCL Business Services
The business services segment continued its momentum and sustained its market leadership in IP Bandwidth, Cloud, Data Center, and other ICT services segments. PTCL’s Corporate business grew by 14.0 percent as compared to last year. Within the Wholesale business segment, carrier revenue grew by 6.6 percent but the overall Wholesale segment revenue has declined as a result of the closure of certain international IP leased circuits. International revenue, helped by the favorable impact of currency devaluation, has increased by 13.7 percent over last year.
PTCL Business Solutions wing strives to provide innovative enterprise solutions to accelerate growth through a robust telecommunication infrastructure and a diverse portfolio of services with enhanced customer experience.
PTML – Ufone Highlights
Ufone posted a YoY growth of 1 percent in topline in Q1 2022 despite challenges of the increase in Advance Income Tax (AIT) and reduction in Mobile Termination Rates (MTR). Excluding the impact of these factors, the normalized growth is 5.3 percent as compared to the same period of last year.
- Significant network modernization activity and rollout of new sites have been carried out in Q1 2022.
- UPower, a flagship customer-centric product, was launched during the first quarter and has registered tremendous response from the customers.
With the acquisition of the 4G spectrum, Ufone’s performance in the data segment has improved considerably, achieving the highest number of total data subscribers in the industry during the first two months of 2022 and continues to increase its share of new 4G subscriber acquisitions in the industry. With better data speeds, Ufone has been able to improve the customer experience for its users across the country.
The recent ‘Mobile Networks Benchmark Report for 2022’ by PTA also declared Ufone as Pakistan’s best quality Voice and Data Network. Attracting significant attention from mobile users across Pakistan, the launch of UPower has resulted in substantial subscriptions to the product. UPower gives its users the freedom to choose from various voice and data bundles tailored to their needs.
U Bank Highlights
U Bank, the microfinance and branchless banking subsidiary of PTCL continued its growth trajectory and has achieved 13 percent growth in its revenue. The bank grew its funding book to Rs. 90 billion by leveraging its deposit and corporate finance arms, which is in line with the bank’s ambition to maintain its superior liquidity position.
Major strategic initiatives undertaken by the bank include venturing into the low-cost housing loans, Islamic Banking space, and international remittance. The bank plans to invest in technology to make the most of the opportunities available on the digital banking front.
