Sonatel sees fall in net profits in 2010 as competitors muscle in
Senegalese incumbent telecoms operator Sonatel said its net profits for FY2010 were hit as increased competition in the markets in which it operates trimmed its margins and it was hit by a temporary tax surcharge on incoming traffic.
The group also warned about the future impact of fiscal and regulatory pressure, which it says ‘is becoming a major concern’. Nevertheless, the group is upbeat about the future noting: ‘The macroeconomic outlook is good for 2011 with higher GDP growth than in 2010 seen in all our countries.’
Sonatel's consolidated turnover rose 6.5% year-on-year to CFA599 billion (USD1.2 billion) as it expanded its business operations in Mali, Guinea, Guinea-Bissau and its home market – where mobile subscribers topped the five-million mark for the first time. However, net profit fell to CFA184.8 billion in 2010 from 185.0 billion a year earlier and its EBITDA margin fell to 54.1% from 56.2% over the same period.
Between June and November 2010, Sonatel was adversely impacted by a surcharge on incoming international calls as Senegal sought to monitor telecom traffic and boost public finances. This measure was suspended after union protests caused a shut down and disruption of some long-distance and internet services. Sonatel, 42%-owned by France Telecom, has a total market share of 60% in Senegal and 69% in Mali.