GP profit down despite revenue surge in 2022

The country’s largest mobile phone operator Grameenphone’s net profit trickled by 12.09 per cent year-on-year in the year 2022 although the multinational’s revenue grew by 5.12 per cent same year.

The publicly traded company’s profit fell to Tk 3,009 crore in 2022 which was Tk 3,412 crore the year before.

The telecom operator’s profit got adversely impacted by foreign exchange losses and a negative verdict of legacy litigation last year, according to the company. 

The largest market-cap company reported revenues of Tk 15,040 crore last year.

Due to a regulatory ban on the sale of sim cards during the second half of the year, the company registered a 5.12 per cent YoY lower subscriber base, reaching it to 7.91 crore at the end of 2022.

The company on Tuesday declared a 95 per cent final cash dividend to its shareholders for the year 2022 through the Dhaka Stock Exchange (DSE).

The firm already paid a 125 per cent interim cash dividend last year.

With the newly announced dividend, its total dividend stood at 220 per cent cash for 2022 which was 98.72 per cent of its total profit.

“Grameenphone displayed a resilient performance in the face of external hurdles in the fourth quarter of 2022, ending the year with continued topline growth momentum,” Yasir Azman, chief executive officer of Grameenphone, stated in the company’s annual financial report.

“The ongoing year-over-year growth was mainly driven by our increased investment in network and deployment of new spectrum, reaching the milestone of over 20K total sites and 19.6K 4G sites on our network,” Yasir Azman added.

The country’s telecom regulator on June 29 last year banned GP’s SIM sales citing the operator’s poor service quality including the increasing call drop rate. The ban, however, was lifted on January 3, 2023. 

As a result of Grameenphone’s commitment to continue prioritising customer experience, its data usage grew by 38.8 per cent last year, while the number of 4G data users surged by 23.6 per cent to 3.42 crore at the end of 2022, despite ending the year with a lower subscriber base, said Yasir Azman.

The Telenor Group-led company’s earnings per share (EPS) stood at Tk 22.29 for 2022 which was Tk 25.28 in the previous year.

Its net asset value (NAV) per share stood at Tk 34.22 and net operating cash flow per share (NOCFPS) at Tk 47.26 for the year ended December 2022 against Tk 36.94 and Tk 42.82 respectively for the previous year.

Investment in network and spectrum deployment contributed to growing usage of data and bundle segments, leading to seven consecutive quarters of YoY revenue growth despite a lower sub-base from the ban of sim sales,” Jens Becker, the company’s CFO, said in its annual financial report.

Grameenphone also registered constant growth in earnings before interest, taxes, depreciation, and amortization (EBITDA), supported by the growth in revenue and efficiency measures despite the current macroeconomic pressures with rising inflations, he said.

To approve the dividend and audited financial report, the company would conduct an annual general meeting (AGM) on May 2 this year.

In 2021, GP’s net profit dropped by 8.22 per cent or Tk 305.8 crore to Tk 3,413 crore from Tk 3,719 crore in the previous year.

The publicly traded company’s earnings per share based on comprehensive income dropped to Tk 25.28 in 2021 from Tk 27.54 in 2020.

It disbursed a 125 per cent interim cash dividend for 2021, taking the total to 250 per cent for the entire year.

Norway’s Telenor holds a 55.8 per cent state in Grameenphone, while local firm Grameen Telecom owns 34.2 per cent stake in the company.

The remaining 10 per cent shares are in the hands of institutional and general investors.

Listed on the Dhaka bourse in 2009, the company has a paid-up capital base of Tk 1,350 crore.

GP shares stood at Tk 286.60 per share on the DSE trading floor Tuesday.