Dialog Axiata PLC, Sri Lanka’s biggest mobile phone operator, said this week that group post-tax profit for the three quarters ending September 2010 was Rs. 3.77 billion while revenues rose to Rs 30.67 billion.
“The Dialog Group recorded a free cash flow of Rs. 7.30 billion in the same period,” the group said in a statement this week. The results included those of Dialog subsidiaries - Dialog Broadband Networks (Pvt.) Ltd and Dialog Television (Pvt.) Ltd (DTV).
The group posted a post tax profit of Rs. 1.69 billion for the 3rd Quarter, up 138% increase year-on-year. Dialog Group revenues were recorded at Rs. 30.67 billion for the nine months, up 16% YoY and 4% QoQ (quarter on quarter).
Dialog’s mobile subscriber base stood at 6.7 million as at end of September, up 6% YoY. “The 3rd Quarter of 2010 featured the transient impact of downward tariff adjustments in the mobile market, immediately following the introduction of floor rate regulations in July 2010. Accordingly, Core Mobile revenues (excluding interconnection income) which exhibited 13% growth YoY, declined marginally by 1.5% on an adjacent QoQ basis. Notwithstanding the transient impact of tariff adjustments across the sector, total revenues were bolstered by increased consumption of mobile voice and mobile broadband services, as well by interconnection income, resulting overall in a 4% growth in revenue on an adjacent QoQ basis,” the company said.
The 3rd Quarter featured the impact of several changes in the sector cost structure including but not limited to those accruing from the introduction of the domestic interconnection regime and the reduction in the international telecommunications levy from $0.038 per minute to $0.015 per minute.
DBN featuring the Fixed Telephony, Fixed Broadband and Data Transmission businesses of the Dialog Group recorded revenue of Rs. 604 million in Q3 2010, up 5% QoQ and 4% relative to Q3 2009.
Broadband and ISP revenues grew by 19% YoY, fuelled by the increase in usage of the corresponding services. DBN’s fixed line CDMA subscriber base increased by 4% YoY to reach 183,000. CDMA usages revenues grew by 3% YoY driven primarily by an increase in interconnection revenue.
The company said strong operating cash flows combined with a prudent and strategic approach to capital expenditure, underpinned the generation of free cash flow of Rs. 7.30 billion for the first nine months of 2010, a five-fold increase relative to the ngative free cash flow of Rs. 1.46 billion in the previous year.
“Positive free cash flows were directed towards de-leveraging the company’s balance sheet, resulting in a reduction of the group’s total debt outstanding by 12% YoY,” it said.