Batelco group's financial results for 2016 are out and while the company has managed to increase its customer base to 9.4 million (+ 4% YoY), the net profits have declined 24% YoY to BD37.6 million ($99.7 million). The group reported gross revenues of BD367.1 million ($973.7 million), a marginal decrease of 1% over the prior year. The group attributes the reduced net profits for the period to an impairment loss on goodwill related to the Group’s operation in Jordan.
The group’s new chairman, Shaikh Mohammed bin Khalifa Al Khalifa, who was appointed in December 2016, announced the 2016 financial results. “Market conditions in Bahrain and across a number of the Group operations are challenging due to the world’s economic climate in general and also due to the vibrant nature of the communications industry which is experiencing a powerful shift as all players strive to gain a strong foothold in the world of digitisation,” said Shaikh Mohammed.
He added: “ The upswing in customer numbers is attributed to our investments in new networks including fibre and our efforts to strengthen our digital solutions portfolio. We are responsive to changes in our environment which helps us shape a flexible and sustainable business model and accordingly, we are optimistic that our subscriber base will continue to grow and ultimately boost the bottom line as a result of our plans going forward.”
Shaikh Mohammed further stressed that throughout the Batelco Group, the aspiration is to achieve operational excellence.
Batelco Group CEO Ihab Hinnawi added that competitive pressure and the conversion of growing demands into enhanced revenues combine to challenge the Group daily.
“To attain our goals we are focussed on a number of key pillars such as the development and growth of our digital solutions throughout the Group, improving the efficiency of our Op-Co’s and the training and development of our own people to ensure the skills sets we need going into the future are readily available," he added.
Jordan's Umniah continued to be affected by the strict tax regime of the country. Subscriber numbers got a blow with the competitor launching 4G services before Umniah.
Talking about the Bahrain operations, Hinnawi said:“In spite of operational difficulties due to the overcrowded communications market in Bahrain, Batelco has not stopped with its bold plans to deliver fibre access to all areas of Bahrain, always keeping in mind the aspirations of the Kingdom’s leadership and the 2030 vision to ensure internet connectivity for all residents." Batelco launched Bahrain WiFi in 2016.
Hinnawi also highlighted the fact that Batelco Bahrain in 2016 also completed a global network expansion project that will serve to ensure network diversity, avoid single points of failure, provide better country resiliency, and efficiently use international capacities.
Summary of results :
Gross revenues: BD367.1 million ($973.7 million)
EBITDA: BD2 million ($358.6 million) (37% margin)
Consolidated net profit: BD6 million ($99.7 million)
Contribution by markets outside of Bahrain: 59% of revenues and 52% of EBITDA
Subscriber base: 9.4 million (+ 4% YoY)
Recommended dividends: BD41.6 million ($110.3 million)(equivalent to 25 fils per share)