Telecom, broadband operators sustain tight quarter

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Telecom and broadband operators have sustained a financially-tight quarter as their earnings sent to headquarters were seen dropping by 30 per cent in Jul-Sept 2011 as compared to same time last year, State Bank of Pakistan data showed. Profit dividends of the telecom and broadband operators stood at $34.6 million in the first quarter of the financial year 2011-12, which showed negative growth compared with $49.8 million of the earning repatriation posted during the same period of previous financial year. According to data, $30.9 million profits were sent by cellular and telecom operators such as Mobilink, Zong, Warid Tel, Qubee, Wi-Tribe etc., as operations and services earnings, whereas $3.7 million earning repatriated abroad by listed companies in stock exchanges such as Wateen, PTCL and TRG through portfolio profits. Analysts said that services’ sales of telecom and broadband operators were witnessed quite low in the first quarter of financial year 2011-12 on decreased consumptions of the subscribers in the country. During the period, heavy rains across the country particularly in Sindh affected the services consumption and infrastructure of telecom sector that impacted negatively on earnings of the telecom operators. They said seasonal drop of services was witnessed in Ramadan as customers’ activities, were traditionally low in the country despite introduction of enhanced services packages particularly by cellular and broadband operators. In Ramadan, the commercial and domestic consumption of telephony and broadband services witnessed a decline of 15 to 20 per cent compared with other months of the year. Subscriptions growth of different operators was slowing down because of shifted priorities of masses in Ramadan. Moreover, the stock exchanges remained volatile in the first quarter of 2011-12 with a mixed trend of share trading particularly in companies of telecommunication sector. Hence, it affected earnings of listed companies in the period under review.