SLT’s investments towards fiberisation pay off in 1Q with higher revenue and profits

From left: Rohan Fernando (Group Chairman-SLT), Lalith Seneviratne (GCEO-SLT), Janaka R. Abeysinghe (CEO-SLT) and Chandika Vitharena (CEO-Mobitel)

Sri Lanka Telecom PLC’s (SLT) investment towards fiberisation and the aggressive roll-out and marketing of fibre solutions paid off during the quarter ended March 31, 2022 (1Q22) as the group reported solid growth backed by higher revenues from its broadband operations. 

The group recorded a consolidated revenue growth of 5.4 percent to Rs.26 billion for the quarter under review compared to the corresponding quarter in 2021, while the post-tax earnings rose to Rs.2.6 billion from Rs.2.1 billion a year ago. 

The SLT group’s EBITDA (Earnings Before Interest, Tax, Depreciation and Amortization) recorded a 9.9 percent Year-on-Year (YoY) growth to Rs. 10.7 billion with the EBITDA margin improving to 41 percent for the quarter against 39.4 percent in the corresponding period of the previous year. 

“The group’s revenue growthwas primarily driven by the increased broadband revenues resulting from the ongoing accelerated Fibre Expansion Project under the National Fiberisation Programme and due to the expansions and upgrades in the 4G/LTE network,” SLT said in an earnings release. 
Meanwhile, the group saw an increase in PEOTV revenues during the quarter under review“due to the accelerated Fibre Expansion Project.”

The group’s revenue from career domestic services too improved during the period.
The operating cash flows of the group grew to Rs. 16.3 billion, up by 35.3 percent YoY. The group recorded a favourable cash and cash equivalents position of Rs. 31.6 billion as at the end of the quarter. 
The group paid Rs.4.2 billion in direct and indirect taxes including levies during the quarter.
Sri Lanka Telecom PLC (SLT), the holding company of the group, recorded a post-tax profit Rs. 4.1 billion for the quarter on the back of a sharp exchange gain of Rs.3.2 billion. 

Meanwhile, the mobile services arm of the Group, Mobitel (Pvt.) Ltd, sustained revenues at previous levels, earning Rs 11.6 billion during the quarter under review.

“Both EBITDA and operating profit margins remained positive at 38.9 percent and 19.3 percent respectively, whilst foreign exchange losses negatively affected the bottom line of the company,resulting a net loss of Rs. 0.8 billion for the quarter,” 
SLT said.

The SLT group said it si looking to implement several key strategies to meet the economic slowdown and the challenging operating environment thatincludes cost increases, inflation, rupee depreciation against US dollar and delays in importing necessary equipment. 

“Consolidating infrastructure at group level, restructuring field staff to work smarter, encouraging and deploying more staff to work from home, offering value addition to all customer segments, and a focus on delivering long-term financial performance through a more sustainable business model are among these strategies,” 
it added.