SLT Group 1Q 2020 Operating Profits grow by 28% to Rs.3.2Bn
Sri Lanka Telecom PLC Group released its financial results for the three months ending on 31st March 2020.
The Total revenue for the quarter recorded Rs.22.1 Bn, which is a 3.8% growth compared to the Rs. 21.3 Bn during the same period in 2019.
Stringent measures were taken to manage operational cost and investments in capital expenditure, which resulted in Cost savings of 5% for the quarter amounting to Rs.704 Mn. The quarter under reference registered an increase in depreciation cost as well as provisioning requirement of Rs.536 Mn as per the new SLFRS regulations for overdue debtors. Despite the above facts the Group Operating profit for the quarter recorded Rs.3.2 Bn, which is an improvement of 28.6% compared to the previous year.
Due to the depreciation of the Sri Lanka Rupee arising from the Pandemic situation, the total Forex loss for the Group was recorded as Rs.683 Mn, which is a substantial increase against the Rs.172 Mn gain for the same period in 2019.
Increased borrowings over the last few years for infrastructure development has raised the financial cost of the Group by Rs.317 Mn for the quarter. The Group net profit recorded Rs.1.9 Bn for the quarter, which is a 14.6% decline compared to the previous year. This is due to provisioning for overdue debtors, exchange loss and increase in financial cost. During the period under reference, the SLT group paid out a total of Rs.4.4 Bn direct and indirect taxes and levies to the Government of Sri Lanka.
The latter part of the quarter was affected by the COVID-19 pandemic, which required stringent health precautions and work from home operating modules. The SLT Group, being the foremost National Telecommunication Service provider connecting most of the essential services, implemented business continuity plans to ensure an uninterrupted quality service to the Nation. The SLT Group also provided a multitude of bundled telecom packages at concessionary rates and free offers of data to certain segments.
Commenting on the results, Mr. Rohan Fernando, the Group Chairman, stated, “I’m proud of the management team and staff for their dedication and commitment in proving an uninterrupted service to the Nation during the COVID -19 pandemic, while recognizing the National responsibility of the Group. The group offered free unlimited data and several other offers by both SLT and Mobitel, making the connections among family, friends and relatives easier. By now, we are fully prepared and equipped not only to survive amidst the pandemic, but also to reap the emerging opportunities with novel digital products and services”.
Mr. Kiththi Perera, Chief Executive Officer of the Holding Company stated, “Our first quarter results marked a steady financial performance amidst the COVID-19 pandemic. We had to pay attention to a variety of stakeholders, with employees and customers topping the list, amidst focusing on low disposable income levels of the customers coupled with regulatory instructions to refrain from disconnecting the unpaid subscribers, and the collection of billed revenue for the organization,”.
Mr. Priyantha Fernandez, Chief Operating Officer of SLT added, “The ongoing accelerated Fiber expansion project of SLT under the National Fiberization Program will further increase the Fiber footprint across the Country targeting consumer, enterprise and government sectors, allowing them to enjoy ultra-high speed broadband access with lowest latency and availing an array of high definition audio and video entertainment and digital services. Further, the recently launched global brand “Xyntac” will better position itself in the global market. Accordingly, “Xyntac” will promote voice, data and connectivity and innovative digital services with its product portfolio to cater to the ever evolving global market requirement”.