Finance, tax costs cut GP’s annual profit 

Grameenphone’s net profit fell by 8.2% to Tk 3,422 crore in 2021 due to an increase in finance and tax expenses.

The country’s largest mobile operator suffered a drop in profits despite growing 2.5% year-on-year to Tk 14,307 million in the year to ending December 31st.

Jens Becker, Grameenphone’s chief financial officer, said in a press release on Thursday that net profit declined last year due to favorable one-time adjustments to its finance charges and tax charges.

The company paid 71.8% of its total revenue to the national treasury in the form of taxes, value added tax (VAT), fees and charges for the 4G license and spectrum allocation in 2021, compared to 70.4% in 2020 and 59.2% in 2019.

Yasir Azman, chief executive of the mobile operator, said the ongoing pandemic has brought several hurdles in 2021 as the country faces its highest surge of Covid-19, followed by lockdowns. “Even then, the company reported improved financial performance in 2021, driven by an increase in users and usage due to improved network and experience,” he added.

Meanwhile, the company has shared 99% of profits in the form of dividends with its shareholders at a time when other organizations are resorting to profit accumulation to face the economic challenges ahead.

The operator has a liability of Tk 12,580 crore to the Bangladesh Telecommunications Regulatory Commission (BTRC) on a request for an audit report, which falls under the jurisdiction of the High Court.

Grameenphone had paid Tk 2,000 crore to BTRC as instructed by the High Court.

On the other hand, the company has a reserve and a surplus of Tk 3,121 crore, according to the Dhaka Stock Exchange (DSE).

Yasir Azman said, “Through collaboration and dialogue, we resolved several regulatory issues during the year. And we are successfully negotiating to resolve those that have been long outstanding.”

In addition, during the October to December quarter of last year, its number of mobile subscribers decreased slightly compared to the previous quarter. The number of data users also decreased by 3.25% over the period.

However, it recorded a 5.3% year-on-year growth in the number of mobile subscribers to 8.33 crore and the number of data users increased by 8% to 4.46 crore.

Yasir Azman said: “Competition in the mobile data industry has increased a lot. Modernization has been a key focus for us this year, focusing on operating models, integrating automation, improving skills and building capacity. The right mix of skills, capabilities and tools will continue to serve as a catalyst for future growth.”

Meanwhile, Grameenphone has recommended a total of 250% cash dividend, including 125% interim for 2021, compared to 275% cash dividend the previous year.

Due to the lower dividend, its share fell 1.13% to close at 351.40 Tk on the DSE on Thursday.

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