Qtel reports $286m Q2 profit

UPDATE 1: Qatar-based telecom firm's second quarter proft up 58.6% from same period in 2008.

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Qtel reports $286m Q2 profit Qatar-based telecom firm's second quarter profit up 58.6% from same period in 2008.
By  Reuters Published  August 16, 2009

Qatar Telecommunications Co (Qtel) on Sunday said quarterly profits jumped 59 percent, buoyed by a one-time gain at its Kuwaiti unit.

Qtel posted net profit of QR1,044bn ($286m) in the second quarter, up from QR658.5m in the prior-year period.

Qtel booked a QR343m gain after its Kuwait business, National Mobile Telecommunications , won a court ruling reversing provisions it had set aside in a dispute with Kuwait's ministry of communications.

"The results are not outstanding, it's more or less in line with expectations," said Kunal Bajaj, an analyst at HSBC.

"Certainly it's not an outstanding result, which it appears to be at first glance."

One analyst had forecast profit of QR615m in the quarter, according to a Reuters survey in July.

Consolidated revenues rose 30 percent to QR5.9bn in the quarter ended June 30, up from QR4.6bn a year ago.

The company, which does not provide earnings forecasts, said the outlook for the second half of the year seemed positive.

"The economic conditions generally are improving," a company spokesman said on a conference call.

Qtel said it earned profit of QR1.64bn in the first half of the year on revenues of QR11.54bn. That is up from QR1.2bn in the same period last year, on revenues of QR8.1bn.

Total customers stood at QR52.2m as of June 30, up 2 percent from the same period last year.

Qtel, which owns a controlling stake in Indonesia's second largest telecoms firm, said Indosat contributed the most to both customer base and revenues, with 29.4 million customers and QR3bn in revenue in the first half of 2009.

Faced by intensifying competition in their home markets, Gulf Arab telecom firms have been expanding abroad, snapping up assets in Asia and Africa worth billions of dollars.

State-controlled Qtel has expanded rapidly outside its home country into 17 countries, including Kuwait, Iraq, Algeria and Oman as it aims to join the world's top 20 telecoms firms by 2020.

Its focus has been on acquisitions in the Middle East and North Africa region, the Indian subcontinent as well as south east Asia. Qtel bought a 40.8 percent stake in Indonesia's second-biggest mobile telephone firm in June 2008 and raised its holding to 65 percent in February.

Asked whether Qtel, which owns a stake in Kuwait's National Mobile Telecommunications (Wataniya), may be eyeing African expansion, the spokesman said: "That's not part of our stated strategy.

"Having said that, we are flexible in our approach. If there is an opportunity which adds shareholder value, we might look at it."

He declined to comment on any Qtel interest in the African assets of Kuwaiti rival Zain which has put those operations on the auction block. (Reuters)

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