Batelco's net profits slide 24.6% in 2012
Revenue dips 6% in 2012 amid tough competition in home market
Batelco Group, the incumbent telecom operator in Bahrain, saw revenues and profits slide in 2012 as increasing competition continued to erode its share of its home market.
The telecom group, which operates in six countries in the MENA region, reported net profits of BD60.3 million ($160m), a decline of 24.6% compared to the previous year's profits of BD80 million.
The group's gross revenues stood at BD304.7 million for the year, a decline of 6% compared to the telco's 2011 revenues of BD327 million.
EBITDA for the year was BD101.8 million, representing 33% margin, versus EBITDA of BD126 million for 2011.
Batelco attributed the decline to aggressive competitive in Bahrain, restructuring costs for 2012 and 2013 and a number of one-off adjustments. Adjusted EBITDA normalised for one-offs was BD123.0M at 40%.
In brighter news, Batelco continued to increase its proportion of revenues and earnings from outside Bahrain, a key pillar of its diversification plans. In 2012, some 41% of revenues were generated from markets outside of Bahrain, compared to 37% of revenues in 2011.
The group also ended the year with a strong balance sheet and financial position. As of 31 December 2012, net assets were BD520.2 million with net debt of BD18.4 million and cash and bank balances of BD95 million.
The group's subscriber base rose to 7.8 million by the end of 2012, an increase of 18% year-on-year. This includes 17% growth in mobile customers and 52% growth of the broadband subscriber base.
Batelco Group Chairman, Shaikh Hamad Bin Abdulla Al Khalifa, said: "Despite the decline in revenue and income year over year, our profits remained healthy as did our ability to deliver adequate returns to shareholders.
"The actions we've taken over the past year, both in streamlining our operations and planning for further growth will also ensure this continues well into the future."
Shaikh Mohamed Bin Isa Al Khalifa, Group CEO, Batelco, added: "We ended the year on a strong note throughout our operations. Our total subscriber base grew to more than 7.8 million across six markets (excluding results from Indian operations) representing 18% growth year on year with especially strong results from Jordan and Yemen during the year and fourth quarter in particular. We are working hard to support organic growth whilst continuing to identify opportunities to acquire new cash generative businesses with a strong and growing base of customers."