SLT posts Rs 5.6 b profits for 2007
Sri Lanka Telecom PLC (SLT) reported an after tax group net profit of
Rs. 5.6 billion during the year 2007 compared to Rs. 5.4 billion of the
previous year.
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Sri Lanka Telecom Headquarters.
Picture by Sumanachandra Ariyawansa |
The group has achieved a 3.7% growth despite the reduction of call
and rental chargers of fixed lines and reduction of CDMA connection
charges during the year, SLT said yesterday.
Profit after tax at the company level has dipped by 2% to Rs. 5.4
billion due to price reductions and inflationary factors.
CEO, SLT Shoji Takahashi said 2007 was a year of mixed results.
During the year we have achieved several milestones such as business
diversifications, improvements to credit ratings, gaining BOI duty
concessions etc, while reducing prices.
This is important to maintain our competitive position in the market
even though there is a marginal impact on our current year results. Our
strategy to move from traditional voice business to package solutions
will definitely differentiate SLT from others in the market place."
Despite the reduction of local call charges and rentals over 8%
effective from January 2007 the company has been able to maintain the
effective revenue reduction rate as low as 4%, by increasing the
customer base.
Company expects a further recovery of the drop through increased
usage of phones due to the more competitive tariff.
The fixed line customer base increased from 1.18 million at end 2006
to 1.43 million as at end 2007.
The CDMA connection charge is immediately recognised in the income
statement as revenue. During the year over 224,000 new CDMA connections
have been given compared to 223,000 given in 2006.
In achieving this number SLT reduced the connection charge in May
from Rs. 18,400 to Rs. 12,500 and in November introduced the CDMA Vplus
package at a charge of Rs. 7,500 for customers who wish to use the phone
only for voice services.
The main purpose of the reduction of connection charges was to pass
the benefit of duty concessions and reduced cost to the customers. The
price reductions have dipped the revenue by 11% to Rs. 3.4 billion.
The board of directors, of SLT has decided to pay R. 1 as first and
final dividend for the year 2007. The pay out ratio is 32%.
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