BH Telecom predicts 7 pct profit drop, sees some recovery in 2014

Mtel ad Banja Luka

24/12/2013 13:32

* Operator sees 7 pct fall in 2013 pretax profit * Blames falling prices of international traffic * Invested 150 mln marka, pays dividends of 110 mln marka SARAJEVO, Dec 24 (Reuters) - Bosnia's BH Telecom  BHTS.SJ  expects a 7 percent drop in pretax profit to 137.5 million marka ($96 million) on revenue down 2.5 percent at 597 million marka this year, but there should be a pick-up in its performance in 2014, the company said on Tuesday. "We expect an increase of a few percent in 2014," said General Manager Nedzad Residbegovic, who blamed this year's fall in profits on lower prices for international traffic and increased operating costs. Speaking at the company's annual news conference, Residbegovic said costs had been hit by public procurement rules, which obliged a 90 percent state-owned operator to put all its buying out to the lengthy process of public tender. BH Telecom has also seen a fall in numbers of fixed-line subscribers this year by 25,000 to 437,300 but its mobile network users rose by 40,000 to 1.53 million and internet users by 20,000 to 168,000, Residbegovic said. "We are still the dominant telecoms operator in Bosnia, with a market share of over 50 percent in  fixed-line telephony and up to 44 percent in mobile telephony," said Hamdo Katica, the company's executive director for development. BH Telecom operates mainly in parts of Bosnia's autonomous Federation dominated by Bosniaks, while HT Mostar, which is based in the southern town of Mostar, operates mainly in its Croat-dominated areas. Its main rival is Banja Luka-based m:tel, operating mainly in the autonomous Serb Republic but taking a 34.5 market share in the whole country. HT Mostar accounts for around 13 percent of the market and small operators for around 4.5 percent. Residbegovic said that BH Telecom invested 150 million marka in the expansion of the fixed-line network and new technologies, and that it will pay an unchanged annual dividend of 110 million marka from its 2013 profit. ($1=1.427 Bosnian marka) (Reporting by Daria Sito-Sucic; Editing by Greg Mahlich) ((daria.sito-sucic@thomsonreuters.com)(+38733 295 484)(Reuters Messaging: daria.sito-sucic.thomsonreuters.com@reuters.net)) Keywords: BOSNIA BHTELECOM/RESULT