Sri Lanka Telecom Group records Rs. 2.7 billion after tax profit
The Morning: Sri Lanka Telecom Group (SLT Group), the National ICT solutions provider, recorded a Group Profit After Tax (PAT) in Q1 2022 of Rs. 2.7 billion, despite challenging economic conditions.
Consolidated revenue recorded a year-on-year (YoY) growth of 5.4% to Rs. 26 billion in the same period, in comparison to the corresponding period in the previous year.
SLT Group Chairman Rohan Fernando stated: “The first quarter of 2022 proved more challenging than we had expected; however SLT-MOBITEL’s overall performance reflected the resilience and strength of our portfolio. Throughout 2022, we aim to continue to deliver value for all stakeholders reinforcing our support to bridge the digital divide serving the Nation and our people. Prudent financial discipline was also a key factor in our success.”
Beginning the new year, the group continued its focus on the digital transformation agenda, streamlining the cost base and automating processes while delivering and creating value for stakeholders and the nation.
SLT Group’s EBITDA (Earnings Before Interest, Tax, Depreciation, and Amortisation) recorded a 9.9% YoY growth to stand at Rs. 10.7 billion, with the EBITDA margin improving to 41% for the quarter against 39.4% in the corresponding period of the previous year. The Group recorded a Profit Before Tax (PBT) of Rs. 3.5 billion for the quarter.
SLT Group CEO Lalith Seneviratne added: “We continue to invest in the best of emerging technologies, including networks and digital capabilities, and continue our efforts to deploy an innovative portfolio of products and services implementing the transformation of the Company. Our considerable infrastructure investment allows us to continue innovating and improve customer experience.”
The group stated that its revenue growth was primarily driven by the increased broadband revenues resulting from the ongoing accelerated fibre expansion project under the National Fiberisation Programme and due to the expansions and upgrades in the 4G/LTE network. The investment towards fiberisation and the aggressive roll-out and marketing of fibre solutions paid off, as it contributed to achieve Q1 targets for the group with increased consumer demand. Further, the group saw an increase in PEO TV revenues due to the accelerated fibre expansion project. The group’s revenue from career domestic services too improved during the period.
The Operating Cash Flows of the group grew to Rs. 16.3 billion, up by 35.3% YoY. The group recorded a favourable cash and cash equivalents position of Rs. 31.6 billion as at the end of the quarter. SLT Group’s contribution to the Government of Sri Lanka during the first quarter of 2022 amounted to Rs. 4.2 billion in direct and indirect taxes, including levies.
Sri Lanka Telecom PLC (SLT), the holding company of the group, recorded Rs. 4.1 billion, in Profit After Taxes for Q1 2022. Revenue for the quarter recorded at Rs. 15.9 billion, whilst the EBITDA and Operating Profits stood at Rs. 6.3 billion and Rs. 1.1 billion, respectively.
SLT CEO Janaka Abeysinghe commented: “We are on track for business growth and improved profitability, driven by rapid adoption of broadband services, fiberisation and increased bandwidth consumption, which is generating robust demand. My team is focused on growth. We are committed to re-invigorating our core broadband and fixed operations while pursuing modernization of our infrastructure. We will continue to work to maintain this positive momentum throughout 2022.”
The Mobile services arm of the Group, Mobitel (Pvt.) Ltd, sustained revenues at previous levels, earning Rs. 11.6 billion in the Q1 2022. Both EBITDA and Operating Profit margins remained positive at 38.9% and 19.3%, respectively, whilst foreign exchange losses negatively affected the bottom line of the company, resulting in a net loss of Rs. 0.8 billion for the quarter.
Mobitel CEO Chandika Vitharena stated: “Even in these unprecedented times, we are poised to capitalise on the growing need to simplify communications. As the National Mobile Service Provider, we continually aim to introduce next-level solutions driven by the digital acceleration across our market segments, delivering superlative customer experience.”
The ICT and telecommunications sectors have shown a buoyant growth in the past few years. The sectors showed positive growth and impressive profits due to the overall expansion in the sectors during the global pandemic. Like in other countries during the period, the ICT and telecommunications sectors in Sri Lanka showed an impressive growth during the pandemic period and continued with the growth momentum. Sri Lankan authorities are also focused in converting the country’s economy into an e-economy whole also widening the existing digital platforms. Given the growing business potential and the country fast becoming a growing business destination in the region, foreign businesses/investors could look at investing in Sri Lanka’s ICT and telecommunications sectors. They could also look at forming partnerships or joint ventures with local businesses to expand in these fields.
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