SLT Group operating profits up 19%

The significant revenue growth during 2015 resulted in Sri Lanka Telecom (SLT) Group operating profit before depreciation and amortisation of Rs. 20 bn with a 7% year-on-year growth. This also resulted in sustaining EBITDA margin at 29%. Depreciation and amortisation of the group increased marginally to Rs. 13.2 bn in line with group investment in infrastructure expansions. Yet the group reported a Rs.6.7 bn operating profit with a strong year-on-year growth of 19%.

The group comprises the holding company Sri Lanka Telecom PLC and eight subsidiaries, including the mobile arm Mobitel (Pvt) Ltd.

During 2015 the group identified strong technology opportunities, accelerated programs and remained in a strong position in the market. All segments of the group contributed to a 5% year-on-year revenue growth for the group - reporting Rs 68 bn in total. Effective cost control measures of the group capped costs at Rs. 48 bn for the year an increase of 4% year-on-year.

The appreciation of the US Dollar against the Sri Lankan Rupee caused the SLT Group to incur Rs. 2.1 bn, in translation losses as the group opted for more foreign currency denominated loans, thus taking advantage of low interest costs by repaying borrowings through internally generated foreign currency in-flows.

TDC refund was not received opposed to Rs 1.3 bn in 2014 thus reflected in profit before tax and profit for the year being Rs. 5.5 bn and 3.7 bn.

The holding company, SLT, reached the revenue milestone of Rs. 40 bn. increasing 4% from the previous year. The increase was largely driven by investments to enhance capacity and introduce new technology while focusing on customer services.

The company expects a continued growth through accelerated i-Sri-Lanka program enabling islandwide high speed broadband, voice and IPTV connectivity augmented with technologies such as LTE and Fibre-to-home. Operating cost increased by 3% to Rs. 30.4 bn compared to the year before. Operating Profit Before Depreciation and Amortisation of the company increased by 8% from the previous year to Rs. 10.1 bn.

EBITDA margin improved to 25%. Depreciation and Amortisation of the company rose 9% to Rs. 7.8 bn, reflecting the continued investments of the company. Operating profit rose 6% to Rs. 2.4 bn compared to the year before. The holding company was also impacted with foreign exchange losses of Rs. 0.91bn and zero level TDC refund against Rs. 0.94 bn in the previous year, resulting in Profit Before Tax and Profit for the Year amounting to Rs. 2.8 bn and Rs. 1.7 bn.

Group Chief Executive Officer Dileepa Wijesundera said last year was a challenging year for SLT and to the entire group, the. The group has responded effectively to the changes taking place in the economic and market conditions while investing over Rs.20 bn in capacity building, introducing new technologies and improving the automation of internal processes.

"We are now focusing to enrich our products with superior quality and the latest technology enriching customers. Therefore, the growth potential of the group is promising," he said.

Group Chairman Kumarasinghe Sirisena said, "We are moving forward very positively discharging our duties to the nation being a corporate citizen having a very rare record of over 150 years of service. The group is contributing to the well-being of people and support the State in economic development while benefitting the investors. The results achieved during 2015 were very encouraging."

Mobitel (Pvt) Ltd. continued its growth momentum recording 6.4% growth in revenue. In absolute terms, Mobitel recorded a sales turnover of Rs. 32.5 bn in 2015 compared to Rs.30.6 bn in 2014, an increase of Rs.1.9 bn.