Royalty payment boosts Qtel's first quarter results
Iraq and Indonesia singled out as strong performers by Qtel CEO Dr Nasser Marafih amid increasing pressure in Qatar
Qatar-based telecom group Qtel posted stronger than anticipated first quarter results today, aided by a one-time royalty payment and strong performances from its subsidiaries in the face of increasing competition at home.
First quarter net profit more than doubled to QR1,213 million (US$333 million), exceeding the expectations of analysts polled by Reuters, who said they expected first quarter net profit of $171.91 million.
The royalty fee Qtel pays the government was reduced from 25% to 12.5%, with the retroactive reduction resulting in a one-off payment of QR554 million ($152 million); excluding this benefit group net profit increased 11% to QR659 ($181 million).
Group revenue stood at QR6.4 billion ($1.7 billion), a gain on last year's figure of QR5.6 billion.
Qtel, which has a presence in 17 countries, cited its "balanced and diversified portfolio" as one of the main drivers of performance over the past year.
It said that 76% of the groups' revenue now is now generated outside Qatar, where it faces competition from upstart Vodafone, which recently announced that it is edging closer to signing up half a million mobile customers.
Qtel conceded that its figures for Qatar were "impacted by initial competitive entrance dynamics", and while its total customer base (across fixed line, internet and mobile) grew by 14% to 2.4 million customers, revenue declined by 6% year-on-year to QR1.4 billion ($384 million).
Qtel group CEO, Dr Nasser Marafih singled out Iraq and Indonesia as two markets "where progress has been particularly encouraging".
Indosat, Indonesia's number two mobile operator, in which Qtel has a 65% stake, increased its customer base to 39.8 million customers, compared to 34 million last year. Revenue increased 29% year-on-year to QR1.9 billion.
In Iraq, Qtel subsidiary Asiacell saw its subscriber base grow by 16%, ending the first three months of the year with 7.7 million subscribers. First quarter revenue stood at QR1.2 billion, a year-on-year increase of 34%.
The group's consolidated customer base reached 67.7 million, an increase of 21% on the same period in 2009.