UK-owned subsidiary Vodafone Egypt (VE) expects to see recovery in mid-2012 after suffering a decrease in revenues in the first quarter of this year. The lack of tourism has had a great impact on revenues gained from roaming costs.
“We expect most of this calendar year will still face a revenue decline year-on-year because of the general economy slowdown, but we are still profitable and plan to see recovery by mid-2012,” says Hatem Dowidar, chief executive officer of Vodafone Egypt.
The operator is planning to invest E£3bn ($505m) in its network this year, which will be financed internally.
“Our strategy is to invest in the network and prepare our self for the rebound in the economy and maintain spending in the market. We intend to stay in Egypt for the long term and help the company,” says Dowidar.
Investments will focus on mobile broadband and internet infrastructure. The company is still discussing whether to build its own fibre-optic network or continue to rent from state-owned Telecom Egypt (TE), which owns 45 per cent of VE. According to Dowidar, there are no talks to change the ownership structure.
On 29 May, the Communications and Information Technology Ministry announced plans to repay the telecoms operators $16.8m for disruption of services when the previous government took down their networks.
“It is a fraction of the real losses, but VE is working with regulatory bodies to prevent future governments from taking down entire networks,” says Dowidar.