Paltel Group Announces Financial Results for the Period Ending 30th of September 2013, Net Profit Increased by 9.5% to Stand at US$ 96.8 Million

RAMALLAH, Palestine, November 12, 2013 /PRNewswire/ --

2.2% growth in Net Revenues to reach US$ 397m (vs. Q3, 2012)

4.2% growth in Operating Income to reach US$ 129m (vs. Q3, 2012)

5.3% growth in EBITDA to reach US$ 175m (vs. Q3, 2012)

9.5% growth in Net Income to reach US$ 97m (vs. Q3, 2012)

9.5% growth in EPS to reach US$0.73 (vs. Q3, 2012)

7.3% growth in CAPEX to reach US$ 32m (vs. Q3, 2012)

2.3% growth in total number of subscribers (Fixed, Mobile, Data) (vs. End of year 2012)

Paltel Group, the telecommunications leader in Palestine providing mobile, fixed and data services announced its financial results for the period ending 30th September 2013. The results showed an increase in net profit of 9.5% to reach US$ 96.8 million compared to a net profit of US$ 88.3 million for the same period of previous year. The earnings per share (EPS) marked an increase of 9.5% to stand at US$ 0.735 compared with US$ 0.671 for the same period of 2012.

The consolidated net operating revenues reached US$ 397.2 million compared with US$ 388.5 million in same period of 2012 reflecting an increase of 2.2% from the previous year. The gross profit, EBITDA and net profit margins achieved growth by 79.8%, 43.9% and 24.3 respectively. The company reported a decrease of US$ 4.8 million in investment losses to reach US$ 2.8 million compared to US$ 7.6 million during the same period of previous year, this decrease has contributed to the positive results of this year, furthermore it is expected that investment losses will shrink further in the future as the company is changing its strategy in terms of regional investments throughout Vtel the international investment arm of which Paltel owns 25.3% stakes.  

Sabih Masri, Chairman of the Paltel Group Board of Directors, stated that Paltel Group financial results in the third quarter 2013 form an indicator of the Group's ability to grow in both financial and operational directions. This growth is a result of the Group's diversity of investments in Palestinian and regional markets according to a well-studied, revised strategy that guarantees rewarding results for the investors of PALTEL. Simultaneously, Paltel Group continued to invest in its telecom network in Palestine within a comprehensive development process of which economic development is an integral part. Such investment in the network aims at providing most recent services to Palestinians to help them shape their economic, social and cultural future. On the other hand, such investment will result in rewarding returns to investors in parallel with the Group's regional investments which started to positively influence the Groups' financial performance.

Ammar Aker, CEO of Paltel Group, stated that the Group maintained growth, provision of modern services and commitment to social responsibility in spite of the existing economic and social difficulties in the region. "The Group continued to give distinguished offers to subscribers that meet their expectations in the light of technology development, which resulted in sustainable growth though the 3G and 4G frequencies are still banned by Israeli authorities" Aker added.

Aker pointed that Palestine shows a huge demand on technology and applications, and this is where the Group sees the opportunity to meet this demand especially in youth sector which represents more than 40% of the population, in addition to the education and community sectors that are yet in the development phase. Therefore, the Group intensified its projects to support technology applications in these key sectors. On the other hand the Group continues to support public and NGO sectors to reach marginalized and underserved communities who need urgent support in different development fields, Aker concluded.  

Operating Performance

The total subscriber base of Group companies grew by 2.3% in the first three quarters of 2013 to reach 3.23 million subscribers. This growth in subscriber base covered subscribers in fixed, mobile and data services sectors.

The number of fixed line subscribers grew from 396 thousand at the end of 2012 to 401 thousand at the end of third quarter 2013 reflecting a 1.2% growth. The ARPU for fixed line users grew by 1.0% to reach US$ 19.3 compared with US$ 19.2 at the end of 2012.

The number of ADSL subscribers grew from 185 thousand at the end of 2012 to 208 thousand at the end of third quarter 2013 reflecting a 12.0% growth. The ARPU for ADSL line users grew by 4.3% to reach US$ 14.2 compared with US$ 13.7 at the end of 2012.

The number of mobile line subscribers grew from 2.59 million at the end of 2012 to 2.63 million at the end of third quarter 2013 reflecting a 1.7% growth. The ARPU in mobile line users decreased by 3.5% to reach US$ 12.6 compared to US$ 13.0 at the end of 2012.

Future Outlook

The company is maintaining a stable growth in both operational and investment activities in Palestine and the region. Based on this stability, the company will continue to search for new opportunities and potential through more investments in the telecoms network in Palestine and will continue to widen its regional investments in order to achieve rewarding results for investors and make their investments profitable and sustainable.

Financial Performance (in Jordanian Dinar)

Consolidated Income Statement

For period ending September 30, 2013

                                 Three months ended   Nine months ended
                                 ------------------   -----------------
                                 September September September
                                 30,       30,       30,       September 30,

                                 2013      2012      2013      2012
                                 JD '000s  JD '000s  JD '000s  JD '000s
                                 --------  --------  --------  --------
    Revenues                     98,646    92,723    281,602   275,439
    Telecommunication services
    costs                        (6,816)   (8,799)   (21,122)  (24,583)
    License fees                 (7,438)   (6,609)   (21,482)  (19,954)
    Other costs                  (4,849)   (6,521)   (14,412)  (18,947)
                                 --------  --------  --------  --------
                                 79,543    70,794    224,586   211,955

    Operating and administrative
    expenses                     (46,661)  (41,686)  (133,281) (124,325)
    Loss from investments        (1,389)   (1,848)   (1,955)   (5,366)
    Finance costs                (227)     (345)     (1,247)   (1,134)
    Other (expenses) revenues    (1,648)   449       (256)     (1,242)
                                 --------  --------  --------  --------
    Profit before income tax     29,618    27,364    87,847    79,888
    Provision for income tax     (6,399)   (6,162)   (19,287)  (17,294)
                                 --------  --------  --------  --------
    Profit for the period        23,219    21,202    68,560    62,594
                                 --------  --------  --------  --------
    Basic and diluted earnings
    per share                    0.176     0.161     0.521     0.476
                                 --------  --------  --------  --------


Consolidated Statement of Financial Position

September 30, 2013

                                            September 30, December 31,

                                            2013          2012
                                            ----          ----
                                            JD '000s      JD '000s
                                            --------      --------
    Assets
    Non-current assets
    Property, plant and equipment           191,086       198,651
    Intangibles                              34,040        34,264
    Projects in progress                      3,512         3,503
    Materials                                12,109        15,827
    Investment in associate                  32,230        38,290
    Available-for-sale investments           95,866        84,718
    Investment properties                     7,138         7,138
    Other non-current financial assets       54,413        51,826
                                            --------      --------
                                            430,394       434,217
                                            --------      --------
    Current assets
    Inventories                               5,138         8,881
    Accounts receivable                      81,214        89,500
    Prepayments and other current assets     41,807        30,296
    Financial assets held for trading         7,636         7,414
    Cash and cash equivalents                61,069        46,213
                                            --------      --------
                                            196,864       182,304
                                            --------      --------
    Total Assets                            627,258       616,521
                                            --------      --------


    Equity and liabilities
    Equity
    Paid-in share capital                              131,625    131,625
    Statutory reserve                                   32,906     32,906
    Voluntary reserve                                    6,756      6,756
    Special reserve                                      7,950      7,950
    Foreign currency translation                           (59)       (50)
    Available-for-sale reserve                          (3,200)      (593)
    Retained earnings                                  289,308    279,979
                                                      --------    --------

    Total equity                                       465,286    458,573
                                                      --------    --------
    Non-current liabilities
    Non-current interest-bearing loans and
    borrowings                                          --          7,090
    Provision for employees' indemnity                  28,580     29,151
                                                      --------    --------
                                                        28,580     36,241
                                                      --------    --------
    Current liabilities
    Accounts payable                                    41,448     41,907
    Current interest-bearing loans and borrowings       19,221     15,198
    Provision for income tax                             2,181      4,373
    Other current liabilities                           70,542     60,229
                                                      --------    --------
                                                       133,392    121,707
                                                      --------    --------
    Total liabilities                                  161,972    157,948
                                                      --------    --------
    Total Equity and Liabilities                       627,258    616,521
                                                      --------    --------


About Paltel

Palestine Telecommunication Company "PalTel" is an integrated telecom operator offering fixed, mobile, Internet and data services throughout Palestine. Paltel is publicly listed on the Palestinian Stock Exchange (PEX). Paltel owns a majority equity ownership in Paltel (fixed line operator), Jawwal (Mobile Operator), Reach (Call Centre services), Palmedia (Media Services Provider), Hulul (Business Solutions Provider) and Hadara (ISP Services). Paltel also owns equity in Vtel Holdings a Dubai-based multinational telecommunications company with interests in Middle East, Asia and Europe. For more information, please visit www.paltelgroup.ps    

For further information please contact
Ms. Fareeda Diab
Director of Investor Relations
Paltel Group
Tel:  +970-2-2944004
Mob:  +970-59-9000022
Fareeda.diab@paltelgroup.ps

SOURCE Paltel Group




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