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Thursday, 23 February 2012

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Capital investment increase by 176% to Rs. 18 b:

SLT Group 2011 PBT Rs 6.53 b

PAT up by 21% to Rs 4.8 b:

Sri Lanka Telecom (SLT), profit before tax (PBT), profit after tax (PAT), revenue and all other key performance indicators showcased sustained improvement.

Having achieved numerous milestones last year, the Group, which released its financial results for the year ended December 31, 2011, has invested heavily for the future with Rs. 18 billion Capex, an increase of 176% YOY, whilst notching profit before tax of Rs. 6.53 billion, a YOY growth of 10% and profit after tax of Rs 4.78 billion, an increase of 21%, while recording a revenue of Rs 50.95 billion. At company level, Sri Lanka Telecom posted Rs. 4.8 billion, that is 21% growth in PBT, and an impressive 44% growth to Rs.3.56 billion in PAT.

A visionary business strategy coupled with a pragmatic transformation plan has driven the Group to become the telecommunication solutions powerhouse in the country, delivering strong financial results that point towards stability and consistent performance within the Group.

SLT saw its wire fixed line revenue stabilise, arresting the declining trend that emerged about five years ago. There was also significant growth contribution from non-traditional revenue streams, mainly fixed broadband, wholesale and enterprise sales, while mobile revenue also displayed a growth of 7% to stand at Rs 21 billion. Local revenue at company level increased by 3%, which validates our strategies to turn around the earlier negative growth.

With revenue growth driven by broadband, data and enterprise services, Sri Lanka Telecom is very focused on creating the optimum balance of revenue stemming from the right product mix. In 2011, there was an aggressive pursuance of business opportunities, while gaps that contributed to leakage or wastage, resulting in unnecessary expenditure, were identified.

Loss making or low margin product lines were rationalised, while the portfolio was consolidated. In tandem, increasing efficiencies became a key strategy of the overall business plan, which, supported through IT and process change, contributed to delivering a very positive impact on the Group’s bottom line, as is seen in the strong financial performance for the year.

The strong focus on instilling operational efficiencies and prudent cost management strategies from the pragmatic restructuring process saw operational costs managed at optimal levels. Company operating costs reduced by 5%, primarily due to the reduction in volume driven expenses and significant reduction in bad debts. At Group level, the increase in operational costs was a marginal 1%.

It was these strategies that contributed to the improvement in EBITDA margins at both Company and Group level, seen at 31% and 34% respectively. Group net cash generated from operating activities also increased from Rs 15.2 billion in 2010 to Rs 20.5 billion, while at Company level, net cash generated from operating activities increased to Rs 13.3 billion from Rs 10.6 billion.

Group EPS increased from Rs 2.18 in 2010 to Rs 2.65 in 2011, an increase of 21%, which reflects the underlying consistent financial performance and increased shareholder value.

 

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