Low Tones

Feb 18, 2008 (LBO) – Sri Lanka's Dialog Telekom group December quarter profits fell 35 percent despite revenue climbing 26 percent as losses from its pay TV business and thinner margins on mobile operations took their toll. Group net profits fell to 1.6 billion rupees from 2.5 billion in the December quarter on revenues of 8.6 billion rupees.

Full year profits fell 11 percent to 8.9 billion rupees, while revenues climbed 26 percent to 32.5 billion rupees.

Dialog said losses from its new businesses were dragging profits down. Dialog Television, a direct-to-home satellite operation lost 788 million in 2007 on revenues of 722 million, on a subscriber base of 50,000.

Dialog Broadband Networks (DBN), which started a CDMA wireless fixed phone service and WiMax services earned revenues of 1.05 billion up 36 percent from 2006. The firm also lost 317 million compared to a profit of 152 million a year before. Meanwhile, at company level which covers the mobile business, profits fell 17 percent to 2.1 billion rupees while revenues grew 22 percent to 8 billion rupees in the December quarter.

"In the core mobile operations, despite gaining subscribers margins are coming under pressure," says Channa Amaratunga, from B

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