Maroc Telecom 2008 profit up 18.5 per cent

Maroc Telecom has reported 2008 net profit of MAD9.5 billion (US$1.1 billion), an increase of 18.5 per cent from 2007. Consolidated annual revenue at the Moroccan operator grew by 7.2 per cent to MAD29.521 billion, generating an operating margin of 47 per cent.

Chairman of Maroc Telecom, Abdeslam Ahizoune, expects the operator to repeat a strong annual performance in 2009, with revenues to increase by three per cent

The company, which is 54 per cent owned by Vivendi, has proposed to distribute 100 per cent of its distributable income, representing a dividend yield of seven per cent.

Despite the prospect of increased competition in 2009, with the entrant of third mobile player Wana Telecom, to add to the presence of existing rival Medi Telecom, Maroc Telecom’s chairman Abdeslam Ahizoune expects the operator’s revenues to grow by three per cent this year.

“Our performance for this year will be good. Our business will remain on a strong path of growth. We have invested in new services that will generate more growth,” Ahizoune told local press.

However, analysts at Morgan Stanley have rated Maroc Telecom’s stocks as ‘underweight’ earlier this year, citing that the operator’s valuation was unattractive with the stock trading at a dividend yield of 8.1 per cent, below the peer group average of 9.2 per cent.

The analysts added that in addition to the award of a third 2G licence in Morocco, other risks to Maroc Telecom’s share performance include further regulatory restrictions on promotions and success in integrating and turning around acquired businesses.

Key value drivers for the company include a continued 100 per cent dividend payout, a stabilised fixed-line customer base, increasing broadband revenues and further room for growth with mobile penetration at 70 per cent.

Maroc Telecom commands a mobile market share of 63.4 per cent or 14.5 million subscribers, with Medi Telecom holding 34.7 per cent, and alternative provider Wana Corporate serving the remaining 1.9 per cent.

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