Oct 27, 2010 (LBO) - Sri Lankan mobile phone operator Dialog Axiata made a net profit of 1.69 billion rupees in the September 2010 quarter compared with a loss of 439 million rupees a year ago, a stock exchange filing said.
Sales rose 16.2 percent to 10.56 billion rupees over the period while administration costs fell 30 percent to 1.5 billion rupees owing to cost cutting.
Basic earnings per share were 0.20 rupees compared with a loss of 0.07 rupees per share in the same quarter of the previous year.
"Group profit was underpinned by robust performance at company level, with Dialog Axiata featuring the group’s mobile business, posting a third quarter and nine-months profit of 1.90 billion rupees and 4.99 billion rupees, up 162 percent year-on-year," a statement said.
Dialog had 6.7 million mobile subscribers as at the end of September 2010, up six percent from a year ago.
Dialog's fixed line CDMA subscriber base increased by four percent to 183,000.
In the June 2010 quarter, Dialog Axiata made a net profit of 1.37 billion rupees compared with a loss of 7.24 billion rupees in the June quarter the year before.
The statement said that the September 2010 quarter "featured the transient impact of downward tariff adjustments in the mobile market, immediately following the introduction of floor rate regulations in July 2010.
"Accordingly, core mobile revenues (excluding interconnection income) which exhibited 13 percent growth year-on-year, declined marginally by 1.5 percent on an adjacent quarter-on-quarter basis," it said.
"Notwithstanding the transient impact of tariff adjustments across the sector, total revenues were bolstered by increased consumption of mobile voice and mobile broadband services, as well by interconnection income, resulting overall in a four percent growth in revenue on an adjacent quarter-on-quarter basis."
The Dialog group returned to profitability in the March 2010 quarter after suffering a string of losses in previous quarters owing to higher costs and a price war brought on by stiff competition.
A segmental analysis in the latest accounts showed the group's entertainment and media, transmission and infrastructure, and fixed telephony, data and ISP (internet service provider) units were still in the red although losses were lower than in the same period the year before.
Dialog has said the finances of its pay television and broadband subsidiaries were improving.
The statement said subsidiaries Dialog Television (DTV) and Dialog Broadband Networks delivered "robust growth" in terms of enhanced profitability at EBITDA (earnings before interest, tax, depreciation and amortisation) level.
"Enhanced profitability at subsidiary level was underpinned by significant performance improvements in the fixed line, broadband, and television businesses of the group."
DTV made a loss of 46 million rupees in the September 2010 quarter compared with a loss of 88 million in the previous quarter, "signalling a robust improvement in profitability" compared with the year before, the statement said.
Dialog said group costs fell in the September 2010 quarter partly because of the introduction of the domestic interconnection regime and reduction in the international telecommunications levy to 0.015 US dollars per minute from 0.038 dollars a minute.
Finance costs also fell 108 percent from a year ago as it used surplus operating cash to repay debt.
In the nine-month period ending September 2010 Dialog also made foreign exchange translation gains of 533 million rupees compared with an exchange loss of 11 million in the same period in 2009. Updated
source - www.lbo.lk
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