Local telecoms monopoly Bahrain Telecommunications Company (Batelco)has reported net profits of BD 54.29 million ($144 million) for 2001, a small increase on the BD 52.50 million ($140 million) recorded the previous year. Analysts had expected the company to post profits in the region of BD 57 million ($151 million) for full-year 2001, but say the 23 per cent increase in selling, general and administrative expenses obviously had a negative effect on the bottom line.
Batelco's decision to cut international call rates in line with a ruling by the International Telecommunication Union also had an impact on the firm's profitability, with an insufficient increase in traffic volume to compensate for the price cut. 'Batelco is a mature company with a small market, so we weren't anticipating particularly strong growth, although we did think it would be slightly better than this,' says a London-based analyst. 'There should be an improvement next year when the company's investments in overseas internet service providers start to yield improved returns.'
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