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Turk Telekom targets 5-percent revenue growth(Daily Star, The (Lebanon) Via Acquire Media NewsEdge) ISTANBUL: Turkish fixed-line and mobile operator Turk Telekom is targeting revenue growth of 5 percent in 2010, driven by both mobile and broadband expansion, chief executive Paul Doany said. Deep economic recession in Turkey forced the firm, which owns mobile operator Avea, to slash its revenue growth target this year to 3-4 percent from an original 8-10 percent, and it has incurred high costs in seeking to win mobile business from competitors with cut-price tariffs. "Next year our main targets are to grow ADSL and mobile revenues. Those are our growth story, and to stabilize the fixed line business," Doany told Reuters on Friday. "On the mobile side the situation is getting better now in the market, Avea's situation will improve. It has done very well by introducing all-direction tariffs, it changed the market." The economic slowdown has seen many Turkish consumers significantly curb phone use and ditch multiple SIM cards in favor of one operator, increasing the appeal of the all-direction tariff, which allows users to phone other networks at no extra cost. Doany added that he saw strong growth potential for ADSL broadband. "At the moment household penetration levels are in the low 30 percent. The opportunity is there for it to be raised to the low 40 percent in the very near term, and potentially in the mid-50 percent in time." Shares in Turk Telekom closed morning trading up 0.9 percent, outperforming a market that traded 0.42 percent higher. They have risen 40 percent since the start of the year, markedly lagging a 75 percent rise in the financials-dominated Turkish stock market. Turk Telekom posted a 16 percent decline in third-quarter net profit to 547.8 million lira ($378 million). Sales rose to 2.67 billion lira in the third quarter from 2.61 billion in the same period last year. "One operator needed to move the market in the right way, with all-direction tariffs. To do that you end up with very intense price competition … that of course led to a loss of profitability but huge revenue growth," Doany said. "Avea shot up hugely out of this and I believe it will prove to be the right thing not just for Avea but for the whole market," he added. Around 40 percent of Turk Telekom's revenues are come from mobile. The group is controlled by Dubai-based Oger Telecom and was listed on the Istanbul Stock Exchange in May 2007. Some 30 percent of its shares still belong to the Turkish government, which has said it plans to privatize another tranche. Doany declined to comment on the issue. Asked about acquisitions he said telecoms firms had become expensive, but he still saw fair value in the IT sector. Fourth-quarter operations seemed to be developing as expected, he said. – Reuters (c) 2009 The Daily Star. All rights reserved. Provided by Syndigate.info an Albawaba.com company |