Profits roll in for AKTEL
AKTEL, the market's third largest mobile operator, has returned to profitability in the second quarter of 2009, after a gap of two years, putting its financial position second to the largest operator, Grameenphone.
The company's profit after tax and minority interest (PATAMI) was Tk 618 million at the end of June 2009, which was a deficiency of Tk 214 million in June 2008, according to the financial report of Axiata, the Malaysia-based controlling company of AKTEL.
In the six operator mobile market, Grameenphone (GP), which is controlled by Norway-based Telenor, was the only profitable operator till March 2009. GP's operating profit stood at Tk 569.63 crore at the end of June 2009.
Cost management and lowering subscriber acquisition costs mainly helped AKTEL return to breakeven.
Initially, the company made profits until June 2007, after which it faced massive financial losses for two years because it had to compensate the telecom regulator with Tk 145 crore for involvement in illegal call termination through VoIP (voice over internet protocol) technology.
AKTEL's EBITDA (earnings before interest, taxes and depreciation) improved by 44 percent to Tk 3,539 million in June 2009, up from Tk 2,459 million a year ago.
"The EBITDA improved significantly mainly from lower subscriber acquisition and related costs, and reduced interconnect tariff for calls between operators by the telecom regulator," says the Axiata report.
Mobile phone operators in Bangladesh used to pay Tk 800 as connection taxes on behalf of new customers. However, from July last year, some operators, including AKTEL, decided not to bear the tax anymore to minimise losses.
The telecom regulator at the end of 2008 also cut interconnection tariff between mobile to landline or mobile-to-mobile from Tk 0.40 to Tk 0.25.
Axiata Group Berhad (formerly known as TM International) is controlling interests in Malaysia, Indonesia, Sri Lanka, Bangladesh and Cambodia with significant strategic stakes in India and Singapore.
Presently, Axiata controls 70 percent shares of AKTEL, while the Japanese NTT DoCoMo is controlling the remaining 30 percent.
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