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Sri Lanka Telecom (SLT) has recorded an operating profit of Rs.7.9 billion marking the highest rate of growth at 26% for the year ended December 31, 2002.

SLT Chairman Thilanga Sumathipala in the recently released annual report said that reduced cost of debt servicing through repayment of higher cost borrowings and a general reduction in interest rates, combined with containment of other costs enabled a disproportionately higher increase of 44% in pre-tax profits to Rs.5.2 million.

This is the highest pre-tax profit recorded by SLT since its incorporation. The post-tax profit of Rs. 2.68 billion is also the highest in SLT since incorporation. SLT group's revenue grew by 15% to reach Rs.25.4 billion

SLT not only consolidated its position as market leader in the industry but also became the only fully integrated telecommunications service provider in the country when it acquired Mobitel in its entirety in November 2002, Sumathipala said.

Last year a successful Initial Public Offering placed SLT as the largest listed company on the Colombo Stock Exchange. Following the completion of five years of stewardship by NTT Communications Corporation management control was transferred back to SLT's own management team, SLT geared itself to meet the new challenges posed by the emerging deregulation in the Telecom sector. "Amidst all these very significant events SLT revenues and profits soared to unprecedented levels," Sumathipala said.

In line with its commitment to privatise state enterprises, the government offered for sale a further 12% state of its equity in SLT through an initial pubic offering on the Colombo Stock Exchange. This second phase of SLT privatisation reduced the government's holding to less than 50%. The success of the issue despite its unprecedented size is a refection of the confidence the investors placed in SLT and its future prospects. Consequent to the issue, SLT now has over 28,000 shareholders making SLT the most board-cased company in Sri Lanka.

Sumathipala said that an exciting new prospect being pursued by SLT is the setting up of a Telecom city that will have a single venue Data Centre, ICT facilitator and Call Centre to provide the latest communications technology and services under one roof. SLT has earmarked a 3.5 acre land at Welikanda for the centre.

SLT Chief Executive Officer Shuhei Anan referring to the Mobitel acquisition said that SLT had bought a 40 percent stake in Mobitel previously, when the Mobile operator commenced operations in 1996. In October 2002 SLT invested Rs.922 million in Telstrar of Australia to acquire the balance 60 percent. Mobitel currently has approximately 12, 000 subscribers and a 18 percent of the mobile market in the country.

SLT's internet customer base grew by 23% in 2002. SLT's internet service was launched in 1996 and by the end of the year the company had 1,200 customers. Their service was re-launched in 2000 as SLTNet and as part of this re-launch SLT set up a help desk and lowered its rates.

Our customer base has now grown to 40,705 a growth of 93% in two years. Our internet marketing strategy has been to offer competitive pricing, a high quality of service and high speed access, Anan said.

SLT has points of presence (POPs) across the country, which allows its subscribers to access the net for the cost of local calls. SLT currently offers internet lines at 64kbps, 512 kbps, client mail service installation, web and DNS hosting as well as POP internet service.

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Copyright 2001 The Associated Newspapers of Ceylon Ltd.
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