Profit of mobile operators has decreased

2016 isn’t so successful for telecommunications organizations, in particular, mobile phone operators. Their profit has considerably decreased in the first semester of ongoing year, as compared to the same period of the previous year.

Thus, quarter indices for 3 companies on the basis of their issued reports have been observed: Vivacell, Beeline and Ucom (former Orange).

Operating incomes of these companies are included in the Table from mobile communication and adjacent activity (fixed communication isn’t included).

Total income of these three companies in the first semester 2016 comprised AMD 49.07 billion. In the first semester 2015 that index amounted AMD 57.3 billion.

Thus, as compared to the previous year, income from mobile communication service reduced by about AMD 8.3 billion or 14.5%.

As we may see, all the three recorded a decrease, of course, in different measures. The biggest reduction recorded Vivacell (AMD 6.2 billion or 17.5%). Ucom’s income has reduced by 11.3% and that of Beeline—7.9%.

It’s noteworthy that the number of active subscribers throughout last 1 year didn’t decrease. Just the contrary, by the end of  the second quarter 2016 total of 3 operators’ active subscribers comprised AMD 3 million 456.2 thousand, which is more by 111 thousand from the index of last year’s same period.

This means that income per subscriber has dropped.

Returning to the number of active subscribers, it should be stated that in the observed period the number of Vivacell subscribers has grown by 86 thousand, thus comprising 2 million 106 thousand, Beeline’s subscribers reduced by 48.5 thousand, thus comprising 8635 thousand, and the number of Ucom’s subscribers reduced by 22.9 thousand, reaching 486.7 thousand.

As a result, Beeline’s balances in total of subscribers have grown, thus respectively comprising 60.9% and 25%. Ucom’s balance reduced from 15.2% to 14.1%.

It should also be stated that 2 out of 3 companies—Vivacell and Ucom, have reduced advertising and marketing expenses. In particular, Vivacell allotted AMD 919.8 million, as compared to the previous year’s AMD 1 billion 5 million.

In case of Ucom reduction of advertising expenditures is more considerable. The company allotted about AMD 874 million in the first semester 2015, and in the same period of ongoing year—AMD 420 million.

Beeline, just the contrary, has increased its expenditures directed to mobile communication advertising and marketing by AMD 35 million, reaching AMD 431.9 million.

On the whole, these three companies altogether allotted AMD 1 billion 771.6 million to advertising and marketing, which is less by AMD 549 million or 23.7% from the previous year’s index (first semester).