Oman Telco Nawras Eyes Broadband After Target Miss
Q2 net profit 10 mln rials, down 13 pct; Company to focus on mobile broadband services - CEO
July 28, 2011 9:13 by Reuters
Nawras , Qatar Telecom’s Oman unit, said on Wednesday its second-quarter net profit fell 13 percent, missing forecasts due to higher operating costs and fixed-line expenses.
The chief executive of Nawras said it would continue its focus on expanding mobile broadband services to drive earnings, but was not looking to borrow to fund growth.
“We are generating enough funds for our expansion,” Chief Executive Ross Cormack told Reuters in a telephone interview. “Real growth will come from broadband. We continue to grow the mobile broadband services.”
Nawras, which ended Omantel’s local monopoly in 2005 when it became the Gulf state’s second mobile operator made a net profit of 10 million rials ($26 million), it said in a statement, down from 11.5 million a year earlier.
Two analysts forecast profit of 12.37 million rials and 12.5 million rials in a Reuters survey.
Nawras rolled out fixed-line services in the second and third quarters of 2010.
“We told the market last year that 2011 will be heavy on expenses. We continue to focus on network expansion,” said Cormack.
The company said revenue grew 6 percent to 48.8 million rials, and that the number of customers using its fixed services increased 71 percent to 13,300 in the first half of the year.
First-half earnings fell 13.3 percent to 22.1 million rials.
Nawras said administrative expenses also increased after it hired about 150 staff as part of a government initiative.
The company said last year it is targeting fixed and mobile broadband to drive earnings growth and would spend 140 million rials on capital expenditure for 2010 to 2011.
Nawras raised 182 million rials from an initial public offering last year.
Shares of Nawras ended down 0.4 percent on the bourse, in line with the general index . The results were announced after the market closed.
($1 = 0.385 Omani rials)
(Editing by David Hulmes) (Reporting by Praveen Menon)