Home Business GP profit slips amid Covid-19 fallouts

GP profit slips amid Covid-19 fallouts

by MD Samsuzzaman Siyam

Grameenphone’s net profit tumbled 23.87 per cent year-on-year in the second quarter of 2020 because of the ongoing Covid-19 crisis.

The largest mobile phone operator of Bangladesh took home Tk 726.55 crore in profit after taxes in April-June, down from Tk 955.28 crore in the same period a year ago.

This had been the lowest single-quarter net profit for GP in recent times. It witnessed 8.2 per cent year-on-year revenue de-growth in the second quarter to Tk 3,306.9 crore.

“The second quarter of 2020 had been challenging for Grameenphone as we experienced an overall slowdown of the economy due to the general holidays,” said Jens Becker, chief financial officer of the operator, in a press release.

For the past four months, the operator has been experiencing the impact of an unprecedented global pandemic, which has compelled it to drastically change the way it worked and served customers.

“In addition to Covid-19, we have experienced impact from challenging weather and regulatory scenario, all of which combined has driven us to de-growth in our performance compared to last year,” said Yasir Azman, chief executive officer of GP.

“While we have had our fair share of struggles, as an essential service, we prioritised in ensuring uninterrupted services for our customers across the country.”

The fall in earnings impacted the earnings per share: it stood at Tk 5.38 in the quarter, down from Tk 7.07 in the same period last year.

GP recommended 130 per cent interim cash dividend for 2020 and the shareholders as of the record date of August 5 will be entitled to it.

The stocks of the largest-listed company in the country traded 0.92 per cent higher at Tk 241.30 on the Dhaka Stock Exchange yesterday.

At the end of June, the number of active users for the operator declined to 7.45 crore, which was 7.65 crore at the beginning of the year.

Of the total active users, 54.8 per cent, or 4.08 crore, use internet. Customers’ average per month data use went up to 2.6 gigabytes.

GP raked in Tk 840 crore from internet data use in the quarter, up 16.66 per cent from Tk 720 crore year-on-year.

It, however, fell from the January-March quarter when it earned Tk 850 crore. This was the first time the earnings from data consumption declined quarter-to-quarter.

The market leader’s revenue is poised for a fresh blow from the third quarter as ‘significant market power’ restrictions have been imposed on the operator from this month.

Market sources say as all telecom carriers reduced data price following a government request after the coronavirus pandemic hit the country, data earnings were impacted.

In the early days of the lockdown, which began on March 26, it was tough for the users to top up mobile phones as shops had to be shut owing to the movement control order.  As a result, earnings from voice call also declined for all operators.

Per month earnings per customer came down to Tk 146 for GP, from Tk 159 during the same period last year.

Despite the challenges, the carrier managed to add 90 lakh users to its 4G network during the quarter to end at 1.52 crore.

It set up 132 new 4G/LTE sites in the last three months, bringing in 77.1 per cent of the population under the coverage of the fastest data network. 


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