Omantel Group net climbs 9pc in H1

16/08/2016 05:48 AST

Oman Telecommunications Company (Omantel) announced a 5.9 per cent increase in Group Revenue for the six months ended June 30, 2016. Earnings climbed to RO 271.6 million this year, versus RO 256.6 million for the corresponding period of 2015.

Parent company revenues recorded a growth of 6.4 per cent, reaching RO 267.6 million compared to RO 251.5 million for the corresponding period of 2015. The parent company contributes 99 per cent of the group revenues.

Retail and Wholesale revenues recorded a growth of 1.7 per cent and 27.8 per cent respectively. The growth is mainly driven by Broadband revenues of Retail segment by 16 per cent and Submarine cable capacity sales of Wholesale segment by 108 per cent. Conventional revenue streams such as voices and SMS continued its declining trend due to Over The Top (OTT) services, Eng Sultan Hamdoon al Harthi, Chairman, Board of Directors, said.

Group total operating expenses increased by 4.5 per cent to RO 199.3 million compared to RO 190.6 million for the corresponding period of 2015. Cost of Sales increased by 7.9 per cent resulting in lower gross margin of 79.6 per cent compared to 80 per cent for the corresponding period of 2015.

Operating expenses (excluding Cost of Sales, Depreciation and Royalty) decreased by 2.4 per cent compared to the corresponding period. Depreciation and Amortisation Increased by 13.7 per cent is mainly from increased investment in network expansion and modernisation of both mobile and fixed networks to meet the growing demand of broadband services, the Chairman said.

Group Net Profit after tax was RO 66.8 million compared to RO 61.3 million of the corresponding period of 2015, which is an increase of 9 per cent. Group Earning per Share (EPS) for the period ended June 30, 2016 is RO 0.089 compared to RO 0.082 for the corresponding period of 2015. The total domestic subscriber base as of June 2016 (including mobile and fixed businesses) has reached 3.313 million (excluding Mobile Resellers) compared to 3.329 million of the corresponding period of the previous year, recording a decline rate of 0.5 per cent compared to last year. However, total subscriber base with mobile resellers reached 4.389 million, an increase of 5.7 per cent.

Commenting on the outlook for the rest of the year, Al Harthi stated: “The Omani telecom market in 2016 will be mainly influenced by three key dynamics: increased local competition through substantial changes in the regulatory framework (including the potential introduction of a third mobile network operator, the new Access & Interconnection regulation and a new Telecom Law), the impact of the oil price and the continuous evolution of OTT (over-the-top) players in the domains of voice, messaging and content. These market dynamics will likely pose challenges for the growth opportunities for Omantel.

“At the same time, the explosion of video services continues to be the key driver for a growing broadband market. 2016 already saw the global launch of Netflix and Omantel has launched its own IPTV solutions, further driving broadband speed and bandwidth demand, but for mobile and fixed services,” he added.

Oman Daily Observer