Telecom News Bulletin

Mobilink, Pakistan’s market leader in cellular services and part of Orascom Telecom Holding (OTH), has posted strong revenues, higher EBITDA and increasing subscriber base in the first half of 2010 as compared to the same period last year.

According to the results published by OTH, Mobilink subscriber base increased by 10.5% as compared to same period last year closing at 32.2 million at the end of H1 2010. Mobilink closed the first half of 2010 with revenues of PKR 47.5 billion showing a YoY increase of 11.4% and there was a YoY increase of 24.8% in its EBITDA in rupee terms. Moreover, the company’s EBITDA margin has increased to 39.6% versus 35.5% over the same period last year.

Commenting on the results, Khaled Bichara, Group CEO, OTH shared that the first half of 2010 has demonstrated stable growth for most of Orascom operations, supported by a trend of high additions to various customer bases. Mobilink’s indicators have shown healthy signs of growth across the board, in particular an 18% YoY increase in EBITDA in USD thanks to reduced SIM tax subsidization.

Rashid Khan, Mobilink President and CEO, said, “Mobilink has maintained a strong presence in the market with aggressive marketing and innovative services. At the back end, we are striving to enhance the user experience by investing in the infrastructure to further improve quality of service. We continue to enjoy the faith of our customers due to our edge in coverage, quality and network strengths and hope to maintain this trend in the second half of the year as well.”

Mobilink has invested over $3.3 billion in Pakistan and will be investing an additional $250 million in 2010. Mobilink and Orascom have also pledged PKR 85 million for efforts being undertaken by the company to reach out the flood affectees hit by the worst floods in Pakistan’s history.

Excerpt From Orascom Fist Half Report 2010:

Mobilink’s subscribers exceeded 32 million in H1 2010. As per Mobilink’s internal reporting, its market share stood at 40.6% at the close of the second Quarter. According to the Pakistan Telecommunication Authority (Regulator), Mobilink’s market share in Q2 reached 32.6%, from 31.6% in last quarter. Mobilink’s revenues increased from USD 529 million in H1 2009 to USD 559 million in H1 2010 registering an increase of 5.8%. EBITDA reached $221 million, 18% higher than EBITDA of H1 last year. EBITDA margin for H1 2010 was at 39.6%.

The Pakistani telecom industry remained competitive with five active contenders. While competitors kept launching aggressive offers to increase respective market share, Mobilink also maintained its strong presence in the market with multiple offers to increase the engagement of the existing subscriber base and attract new customers. In line with Mobilink’s focus on the retention of its market share, an acquisition offer was initiated to attract potential new customers as well as port-ins from competition. In this promotion, all new customers who buy a new SIM or join Mobilink’s network via MNP during the course of the promotion receive up to 1000 free minutes and 1000 free SMS as a bonus on recharge. Furthermore multiple reactivation promotions were carried out, offering combinations of upfront and conditional incentives to all reactivating customers. These promotions were instrumental in increasing the active base by keeping net churn in check. A pre-paid bonus on recharge offer was launched towards the end of the 2nd quarter to boost the daily recharge trend. Customers opting for this offer were instantly awarded free minutes and SMS on any recharge transaction of Rs.100 or more.

All customers making recharge transactions of Rs. 500 or more are also eligible to enter into a lucky draw to win valuable prizes. Jazz ongoing products kept growing in their popularity. Jazz Ghanta and Jazz 24 Ghanta engaged the subscriber base and still continue to increase every month. On the brand building front, Jazz new brand promise campaign, launched in the 1st quarter, was continuously promoted in all product communications. Mobilink launched another corporate campaign which, in addition to focusing on the importance of change agents for the better future of Pakistan, also highlighted Mobilink’s commitment to the field of education. For post-paid customers, Mobilink carried out two promotions in affiliation with the Football World Cup. The first promotion allowed all new and current, corporate and individual customers to get into a lucky draw to win an all-expense paid trip to South Africa to watch the World Cup live.

A second postpaid promotion was launched during the World Cup which allowed customers to enjoy 50% discount on all on-net calls during the match timings every day during the World Cup. The VAS portfolio has been exhibiting consistent and sustainable organic growth in the last two quarters. Pre-paid VAS revenues for Q2 2010 were higher by 2.9% versus Q1 primarily due to smart pricing and aggressive promotions on key services such as RBT, SMS Khazana and Jazz Juke Box. Mobilink added new and improved products to its VAS portfolio. Exciting services such as SMS Chat, Reverse Auction and Guess the Celebrity were introduced in Q2. Following the success of Jazz SMS Khazana, the second phase named Jazz Super SMS Khazana was launched with bigger prizes in the 2nd quarter. Various event based services were also introduced with football and cricket services being the most popular ones.