Price Pressure

ComBank MD S. Renganathan (Centre) introducing the app to CB Governor Indrajit Coomaraswamy in the presence of (from L) ComBank Manager - Card Centre Seevali Wickramasinghe, Head of Card Centre Thusitha Suraweera, Deputy GM – Marketing Hasrath Munasinghe, CB Assistant Governor Ananda Jayalath and CB Director - Payments & Settlements Dharmasri Kumaratunge

Feb 26, 2010 (LBO) – Sri Lanka Telecom group said it suffered a loss in the December quarter but ended the year with a net profit of 785 million rupees, down 89 percent from a year ago. Group sales in the 2009 financial year rose two percent to 48 billion rupees from the previous year, the company, Sri Lanka’s dominant fixed line operator, said in a stock exchange filing.

It said that it made a loss of 379 million rupees in the December quarter compared with a profit of 2.97 billion a year ago while sales rose two percent to 12.2 billion rupees.

Basic earnings per share for the year were 0.44 rupees compared with 4.08 rupees in 2008.

A company statement said “pressure on prices from the competition and cost conscious behavior of subscribers” caused a drop in revenue during the year.

“However as a result of the positive impact of measures taken by the company to arrest the situation throughout the year the revenue declining trend has been mitigated, bringing down the corresponding reduction during the fourth quarter to a negligible amount,” it said.

“This follows the previous two quarters where favorable increases in revenue have been observed.”

The company