Bloomberg News

Telecom Egypt Quarterly Net Falls 10% as Unrest Cut Services

June 01, 2011

(Updates with analysts’ estimates in second paragraph.)

June 1 (Bloomberg) -- Telecom Egypt, the Arab country’s fixed-line telephone monopoly, said first-quarter profit declined 10 percent after communications services were disrupted by anti-government protests.

Net income fell to 892 million Egyptian pounds ($150 million) from 992 million pounds in a year earlier, the Cairo- based company said in a Regulatory News Service statement today. Telecom Egypt was forecast to report a profit of 752.6 million pounds for the quarter, according to the average of five analysts’ estimates on Bloomberg.

"Our revenues have been impacted by the extenuating circumstances in our domestic market; in particular the voice revenues derived from business customers and the international call revenues," Telecom Egypt’s Chairman Akil Beshir said in the statement. "In spite of the unstable political and economic environment our margins have remained robust and in line with management’s original expectations."

Revenue dropped to 2.4 billion pounds from 2.5 billion pounds. Telecom Egypt said in March it incurred 17.57 million Egyptian pounds in damages, or 0.1 percent of its net fixed assets, because of the unrest that resulted in the ouster of Hosni Mubarak as president.

The shares dropped 2.8 percent to 15.54 pounds in Cairo yesterday, giving the company a market value of 26.5 billion pounds. The stock has declined 14 percent this year.

--Editors: Shaji Mathew, James Kraus

To contact the reporter on this story: Mahmoud Kassem in Cairo at mkassem1@bloomberg.net

To contact the editor responsible for this story: Riad Hamade at rhamade@bloomberg.net


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