Batelco posts full-year revenues of BD379.4m
Manama : Batelco yesterday announced a 3 per cent increase in gross revenues, reaching BD379.4 Million (US$1,006.4m) for the full year 2017, as compared to BD367.1m (US$973.7m) in 2016.
Organic gross revenue, which grew for the first time since 2009, was boosted by double-digit growth in broadband and digital services, reporting 16 per cent and 13pc growth respectively. Quarter on quarter gross revenues also reported an 8pc increase compared to 2016 of BD101.9m (US$270.3m) in Q4 2017 compared to BD94.1m (US$249.6m) in Q4 2016.
Group operating profit grew by 2pc notwithstanding voluntary employee retirement costs of BD8.1m (US$21.5m) incurred in Batelco Bahrain. Adjusted net profit, excluding impairments and one-off gain on land, was more than BD40.0m (US$106.1m). The Group’s balance sheet remains robust, with cash in hand of BD158.7m (US$421.0m).
The Board of Directors has recommended a full year cash dividend of BD41.6m (US$110.3m), at a value of 25 fils per share to be agreed at the Group’s Annual General Meeting, of which 10 fils per share was already paid during the third quarter of 2017 with the remaining 15 fils to be paid following the AGM in March 2018. The dividend is consistent with previous years and is an example of Batelco’s commitment to its shareholders.
Batelco’s Chairman, Shaikh Mohamed bin Khalifa Al Khalifa, said: “The business is in great shape, with strong fundamentals, a solid subscriber base and a local market that is outperforming. However, some of our international businesses continue to feel the impact of the political and economic instability across the region and we are providing them with all the support necessary to get them through.”
The Group ended the year with net profit of BD3.5m (US$9.3m) compared to BD37.6m (US$99.7m) reported in 2016, a 91pc year over year decline. The Group reported a Q4 2017 net loss of BD21.7m (US$57.6m) compared to a net profit of BD5.2m (US$13.8m) in Q4 2016, a 518pc decline.
The reduced net profits for the period are mainly impacted by impairment losses related to the Group’s investments in Yemen and Jordan, which were acquired in 2007 and 2006 respectively, and reflect the prudent and conservative strategy of the Group and the Board of Directors since 2013 and in line with International Financial Reporting Standards (IFRS) requirements. The normalised net profit, excluding these impairments was more than BD40.0m (US$106.1m).
Sabafon, in which the Group has a 26.94pc shareholding and acquired in 2007, faced unique operating challenges as a result of the ongoing conflict in Yemen and currency decline, as a result Batelco has impaired the carrying value of its investment by BD30.0m (US$79.6m).
Batelco Group CEO Ihab Hinnawi commented: “While we reported a decline in net profit, this was primarily due to the prudent and conservative strategy of our management team to impair certain assets in Yemen and Jordan, and is not a reflection of the overall health of Batelco.”
Commenting on the group’s domestic performance, Batelco Bahrain CEO Mohamed Bubashait said, Bahrain remains one of Batelco’s most robust markets, reporting a 3pc year-on-year increase in revenue for 2017, boosted by the growing success of fixed broadband and digital services. Batelco’s domestic growth in broadband services was driven by heavy investment in its Fibre Rollout Programme, which contributed to a 32pc YoY increase in broadband subscribers.
For the full year 2018, the Group is anticipating profit in the range of BD40 to 45 million and expects to pay cash dividends of approximately 25 fils per share over the next three years. The Group has also stated its intent to seek the necessary approvals to acquire up to 10pc of its paid-up capital as treasury shares.
Batelco’s Chairman Shaikh Mohamed said: “We are confident in our future guidance, and believe we have a solid strategy in place to help achieve our target revenue and net profit for the full year 2018.”
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