Dialog Axiata reports sharp revenue growth for year-to-dateDialog Axiata reports sharp revenue growth for year-to-date

Dialog Axiata Plc (COL:DIAL), Sri Lankan's largest telecommunications company, reported Friday strong revenue growth during the nine months ending September 30.

The company, which operates Dialog Group, whose subsidiaries include Dialog Broadband Networks and Dialog Television, reported revenues of LKR 33.7 billion for the period, up 10 percent year-over-year.

Revenue growth, in combination with effective cost management led the Group segment to post EBITDA of LKR 11.7 billion, up five percent over the same period last year. Group EBITDA in the third quarter was LKR 4.3 billion.

Net profit for the group was LKR 3.9 billion for the nine months, up four percent year-over-year, while net profit for the latest third quarter rose one percent from the second quarter to LKR 1.4 billion.

The growth was underpinned by robust performance in its core mobile business, the company said.

On the strength of a 7 million strong mobile subscriber base, Dialog Axiata Plc's revenue  for the nine months ending September 30 was recorded at LKR 30.9billion, up 10 percent relative to the corresponding period in 2010.

However, costs rose due to revenue-linked costs associated with international origination and domestic interconnection charges, and escalation in network operating costs in line with the aggressive expansion of the company’s 2G and 3G infrastructure footprint. Higher costs were also related to the impact of non-recoverable VAT expenditures, the company said.

The Plc's EBITDA was flat at LKR 10.9 billion for the first nine months of the year, with an EBITDA margin of 35 percent year-to-date.

Dialog's  television segment saw revenues grow 13 percent year-over-year to reach LKR 1.7 billion for the nine month period, with EBITDA of LKR 377 million. The Pay Television subscriber base increased by 32 percent to surpass the 200,000 subscriber milestone during the third quarter, relative to the corresponding period in 2010.

Dialog Broadband Networks, which features the company's fixed telecommunications business, continued to consolidate performance trends of the previous quarters, the company said, with EBITDA year-to-date growing 175 percent over the previous year period to LKR 456 million. The unit also saw aggressive depreciation charges in the third quarter, however, accruing from the accelerated amortization of its CDMA and WiMAX networks.

Capital expenditure for the year to date has been directed in the main towards strategic investments in High Speed Mobile Broadband and Optical Fibre Network (OFN) expansion projects.