Telecom sector's revenue generation slumps by 30% in first quarter

Analysts say revenue generated by telecom and broadband operators was comparatively low due to decreased consumption.

Telecommunication and broadband operators underwent a slump in the first quarter of the fiscal year 2011-12 when their revenue dropped by 30%, data provided from the State Bank of Pakistan revealed.

The profit dividends of the telecommunication and broadband sectors stood at $34.6 million compared to last year’s earnings of $49.8 million.

According to the data, a $30.9 million share was contributed by the cellular and telecom operators, whereas, the remaining $3.7 million earning repatriated abroad by certain listed companies through portfolio profits.

Analysts said that the revenue generated by telecom and broadband operators was comparatively low due to decreased consumption.

Heavy rains across the country, particularly in Sindh had affected services consumption and infrastructure of the telecom sector which had a negative impact on revenue generation.

They added that the seasonal drop of services was witnessed in the month of Ramazan as the commercial and domestic use of telephony and broadband services declined 15-20% compared with other months of the year.

They also said that the promotional packages introduced in Ramazan did not affect consumer activity, which is generally low in the country during the month.

Moreover, the stock exchanges remained volatile in the first quarter with a mix trend of share trading particularly in the telecommunication sector.

A version of this post originally appeared on ProPakistani.