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Vodafone Qatar Reports Full-Year Loss of $185 Million
Published on:
Vodafone Qatar - a joint venture between Vodafone and the Qatar Foundation - has reported that it generated revenues of QAR 361.5 million (US$99.2 million) for the full year to 31 March, which is 26% ahead of its plan when the company launched its network last year. The net loss was QAR 673.4 million (US$185 million) for the full year was expected and is in-line with the original plan outlined in the prospectus.
Following the launch of commercial services in July 2009 Vodafone Qatar's customer base has grown rapidly, with most customers joining since the launch of Red prepay in September 2009. In the last quarter of the financial year, Vodafone Qatar's customer base grew 32% as a result of continued international calling promotions and the 2010 domestic calling campaign.
The Company's customer base continues to grow; on 9 May Vodafone Qatar announced that they had reached 500,000 customers. This is 7.5% growth in just over five weeks from their financial year end and means that 30% of the population of Qatar now have a Vodafone Qatar SIM.
Vodafone Qatar's reported net loss of QAR 673.4 million for the year ended 31 March was entirely expected and is in-line with what was outlined in the IPO prospectus. In most companies this would typically be compared to the net loss experienced in the previous financial year, which for Vodafone Qatar was QAR 132.9 million. However, Vodafone Qatar's start-up situation makes this comparison inappropriate. Firstly the Company had no customers last financial year and was therefore incurring only costs related to the establishment of the company without the benefit of generating revenue. Secondly, the amortisation of the license fee began on the date the network was ready for service in May 2009, and was therefore not present in last year's financial statements. The amortisation of the QAR 7.7 Billion license fee is a significant amount and represents a considerable portion of the Company's net loss to date. The QAR 7.7 Billion license fee is amortised equally over the life of the license from May 2009 to the end of the license period which is June 2028.
On the announcement of Vodafone Qatar's full year results, Chief Financial Officer John Tombleson commented, "We now have a substantial customer base that will help drive future performance and forms a solid basis for generating future revenue growth. We expect to build upon our achievements in the next financial year."
Tags: [vodafone qatar] [Qatar]
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