CAIRO: Mobinil, Egypt’s largest mobile operator by subscribers, posted annual net revenues of LE 8,200 million for the year 2007, reflecting an annual growth of 29 percent over the same period last year, the company announced Wednesday.
The company also reported that net income reached LE 1,824 million at year-end, showing a 20 percent increase over the same period last year.
“This success is a result of a series of consecutive offers made throughout the past two years and continued in 2007, Alex Shalaby, Mobinil’s president and CEO, said in a press release. “[Our] offers resulted in increasing the full year average usage per user to reach 132 minutes per month representing an increase of 11 percent over the same period last year.
Mobinil also posted that its number of subscribers grew an additional 5.851 million for the fourth quarter of 2007, which means that total number of subscribers has now reached 15.118 million, constituting a 63 percent year-on-year increase.
“2007 was definitely a remarkable year for Mobinil. I am pleased to see Mobinil cross the 10 and 15 million subscriber milestones in one year with the highest level of net additions of almost 6 million subscribers; a figure that was beyond all market expectations, Shalaby added.
The firm’s report coincides with Beltone Financial’s quarterly findings on Mobinil, which were released two day’s before the mobile telecommunications company’s annual report.
Beltone Financial expected Mobinil to report revenues of LE 8,406 million ($1,542 million) for the fourth quarter of 2007, posting an annual growth of 32.1 percent.
“Basically, it’s their pool. Mobinil has been performing well over the last three quarters . and number of subscribers has been growing, said Shrouk Diab, senior telecom analyst at Beltone Financial.
Diab explained that the company reported a “healthy growth of 1.82 million in number of subscribers in September 2007 alone. She had estimated the number of subscribers to grow an additional 1.4 million for the fourth quarter of 2007.
Quite similar to Mobinil’s report, Beltone Financial expected the company’s total subscribers to have reached 15.122 million at the end of last year.
However, Beltone Financial expected Mobinil’s net income to reach LE 2,014 million ($369 million) at the end of December, a year-on-year growth of 32 percent, equivalent to an EPS of LE 20.14 per share, a figure way above Mobinil’s annual results.
“Mobinil is going to sustain its [healthy] performance for the [fourth quarter of 2007]. It is not that far off, Diab predicted.
Recent data shows that Mobinil captures more than 50 percent of Egypt’s telecommunications market. While Mobinil captured 13.72 million in the third quarter of last year, market rival Vodafone Egypt only claimed 11.70 million subscribers. Etisalat Egypt, the country’s latest mobile operator, managed to grab a total of 1.30 million subscribers during the same quarter.
“We succeeded in maintaining our market leadership by offering innovative services and competitive offers tailored to meet the needs of our subscribers, boasted Shalaby. “This success is due to our focused attention on strategic goals to increase subscribers’ loyalty by simplifying tariffs, stimulating usage, and a determined effort to reinforce our customer intimacy leadership.
The three mobile operators are expected to steadily grow in 2008 as Egypt’s telecommunication market recently proved to be an evergreen success story, jumping 70 percent to reach a total of 26.9 million subscribers at the end of September 2007, up from 15.87 million a year earlier.
Egypt’s first mobile operator, Mobinil is a joint venture between France Telecom (which owns 36.34 percent) and Orascom Telecom (which owns 34.76 percent). A total of 28.90 percent of the company is publicly traded on the Egyptian stock exchange.
Last August, Orascom Telecom initiated arbitration proceedings against France Telecom before the International Court of Arbitration of the International Chamber of Commerce. The arbitration concerns a dispute arising out of a shareholders’ agreement between both companies.
The shareholders’ agreement, which governs the relationship between France Telecom’s Orange and Orascom Telecom, provides that in the event of serious disagreement between the parties, each party can have a call option over the other party’s shares.
“This means that whoever wins [in the arbitration] can buy the other party’s shares in Mobinil, Diab explained. “The other party has the right to agree or make a counter offer [to buyout] the company’s shares.
The exercise price of these call options, she added, may not be less than Mobinil’s share price on the stock market. “This could result in a bidding war between France Telecom and Orascom Telecom, as each company insists on remaining in the Egyptian market.
Shares of Mobinil managed to close in the green, despite strong market fluctuations resulting from global market turmoil. The stock traded Wednesday 0.24 percent higher to close at around LE 220 per share. A day earlier, the company surged 4.2 percent to finish at LE 219.48.
According to Beltone Financial, the firm’s average daily turnover is LE 23.6 million. It recommends shares of Mobinil as an “add value, as the company’s fair value is LE 251.32 per share, which is around 19.3 percent higher than its average trading price of LE 210 per share.
The enterprise is valued at LE 23.1 billion ($4.2 billion), with a total market capitalization of LE 21.1 billion ($3.9 billion).
