The protests and ousting of Egypt’s government has already taken its toll on the country’s economy. On Wednesday, Telecom Egypt reported a 10 percent drop in first quarter profits, citing the protests in January and February as having a direct impact.
According to Bloomberg financial news, the company’s first quarter net income fell to 892 million Egyptian pounds ($150 million), but still coming in higher than the news agency’s estimates of around 750 million pounds. Last year during the same period, the landline monopoly company brought in 992 million Egyptian pounds.
Despite the reporting, the company’s shares rose 1.2 percent to 15.73 Egyptian pounds on the Stock Market at closing on Wednesday.
The drop in income was expected, analysts said. They argued that fixed-lines in the country are on the decline and Telecom Egypt understands that it must diversify.
“This is why they are looking at increasing their 45 percent share in Vodafone’s Egypt unit, because the future of telecom here in Egypt is definitely in the mobile sector,” said Ashraf Hassan, a local businessman and telecom advisor to the ministry of communications.
Telecom Egypt was hoping that they would be able to bid, and win, the country’s fourth mobile license this year, but the government said in May that it was looking to push back the fourth license as a result of the declining economy.
By Desmond Shephard
