Batelco CEO sees no major profit rise in 2010

Bahrain Telecommunications (Batelco) expects its full-year net profit in 2010 to be flat from this year's level of just over 100 million Bahraini dinars ($265.3 million), its chief executive said on Thursday.

"Without any acquisitions we still expect another flat year in terms of profits," Peter Kaliaropoulos said during a press conference in Manama. He added the group no longer expects to make an acquisition this year.

Kaliaropoulos said start-up costs for its new operations in India would be compensated by growth in its existing operations elsewhere. Batelco earlier this year led a consortium acquiring a 49 percent stake in Indian mobile operator S Tel Ltd for $225 million.

"We expect it to be 102, 103 or 104 million Bahraini dinars," he said when asked how much profit he expected for this year. Batelco posted net profit of 104.21 million dinars in 2008.

"Should there be any substantial fine from the TRA, that would affect our business adversely," he said.

Bahrain's Telecommunications Regulatory Authority (TRA) is considering putting a fine on Batelco in the single-digit million dinar range for not allowing other telecom operators sufficient access to the landing station for the cable connecting Bahrain to the international network.

The landing station is located on the premises of Batelco , which is rejecting the claims.

Kaliaropoulos also said it would be unlikely Batelco will make an acquisition this year as valuations were above the prices the operator was prepared to pay. He had said earlier this year Batelco expected to make an acquisition of up to $2 billion in Africa or Asia.

"We're not going to rush into acquisitions if the opportunity is not right," he said on Thursday.

Batelco was among foreign bidders for a stake in Morocco's No.2 telecoms firm Meditel, which was sold to local investors last month.

Kaliaropoulos said the company was still looking to make a buy in mobile or broadband operations in North Africa or the Asian-Pacific region.

"We're looking at accretive acquisitions, I don't think we're looking at start-ups," he said.

Batelco is losing market share in its home market Bahrain due to increased competition and is looking to grow its revenue from operations abroad. (Reuters)

READERS' COMMENTS

MORE FROM ARABIANBUSINESS.COM