Turkcell boasts revenue, profit gains despite customer losses

Turkish operator Turkcell has reported impressive gains in revenue and earnings for the three months ending June on the back of strong demand for mobile broadband services.

The company saw revenues increase by 11%, to TRY2.86 billion ($1.43 billion), compared with the same period of 2012, while earnings before interest, tax, depreciation and amortization rose by 12%, to TRY869 million, over the same period.

Turkish operator Turkcell has reported impressive gains in revenue and earnings for the three months ending June on the back of strong demand for mobile broadband services.

The company saw revenues increase by 11%, to TRY2.86 billion ($1.43 billion), compared with the same period of 2012, while earnings before interest, tax, depreciation and amortization rose by 12%, to TRY869 million, over the same period.

Turkcell (Istanbul, Turkey) claimed that revenues from mobile broadband and related services grew by as much as 20%, to TRY653 million, increasing their share of overall revenues to 28% from 25% in the second quarter of 2012.

Net income, however, was up by just 4%, to TRY556 million because of higher depreciation and amortization costs.

Sureyya Ciliv, Turkcell’s chief executive, also drew attention to the operator’s entry into the fiber broadband market, noting that half a million subscribers have now signed up to use its Turkcell Superonline product.

Revenues from Turkcell Superonline grew by 37%, to TRY223 million.

“We believe that we can create even more value for our customers considering the strong potential in mobility, internet, smartphone and application, and continue our investments accordingly,” he said.

Turkcell said the first half of the year had been characterized by price volatility and “unstable competitor behavior” and that it would continue to focus on service quality and innovation as a means of differentiating itself from rivals.

Nevertheless, the operator has lost 191,000 customers between June 2012 and June 2013 due to intense competition in the prepaid segment of the market.

Turkcell was able to offset the effect of those losses by selling more smartphones and persuading customers to sign contracts for mobile data services.

Average revenue per user in Turkey grew by 7.7% due to the increase in the number of post-paid customers and rising usage of mobile data services.

Another plus for the operator was the performance of its foreign subsidiaries.

Revenue from other geographical markets rose by 29%, to TRY537 million, while EBITDA was up by 25%, to TRY171 million.

Publication of the company’s results was reportedly delayed due to dispute between Turkcell main shareholders – Russia’s Altimo, Turkish investment group Cukurova Holding and Swedish operator TeliaSonera – whose origins date back several years.