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Telecom Egypt Third-Quarter Net Income Drops 7.3%

Nov. 11 (Bloomberg) -- Telecom Egypt, the country’s monopoly fixed-line phone-service provider, said third-quarter profit fell 7.3 percent on lower income from associate companies.

Net income attributable to equity holders decreased to 766.1 million Egyptian pounds ($133.3 million), from 826.4 million pounds in the year-earlier period, the Cairo-based company said in a Regulatory News Service statement today. Revenue rose 1.7 percent to 2.58 billion pounds. Earnings per share declined to 45 piasters from 48 piasters. Profit from associate companies fell 25 percent to 291.1 million pounds.

“The drop in net profit in the third quarter relates to non-operational items,” Chief Executive Officer Tarek Tantawy, said in a telephone interview. “We are on track however on delivering our full-year guidance on growth and margins.”

Telecom Egypt is seeking to increase its investment in the mobile-phone market and is exploring a number of options, he said. Vodafone Group Plc, the world’s largest mobile-phone company, said on June 1 it won’t sell its 55 percent stake in its Egyptian unit to Telecom Egypt.

Beltone Financial, a Cairo-based investment bank, said Telecom Egypt’s third-quarter revenue came in line with its expectations and reiterated its “buy” recommendation with a target price of 22.63 Egyptian pounds.

Telecom Egypt shares fell 0.5 percent to 17.38 pounds at the 2:30 p.m. stock market close, valuing the company at 29.7 billion pounds.

To contact the reporter on this story: Ahmed A Namatalla in Cairo at anamatalla@bloomberg.net

To contact the editor responsible for this story: Mahmoud Kassem at mkassem1@bloomberg.net

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