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Cyprus

CyTA posts €70.1m in pre-tax profit in 2015 (Updated)

State telecom CyTA remains a financially robust entity with prospects for growth, the semi-governmental organisation said on Tuesday presenting its financial results for 2015.

At an event in Nicosia summarising CyTA’s operations last year, chairman Christos Patsalides stated that the organisation has managed to hold its own in a competitive industry and amid a difficult economic climate.

This was due to a combination of cost-cutting measures and getting on board with new technologies, Patsalides said.

In 2015 CyTA registered a gross operating profit of €87.5 million, up from €81.4 million the previous year. Pre-tax profits came to €70.1 million, compared to €56.9 million in 2014.

Revenues came to €372.4 million, a decline of 6.1 per cent compared to 2014. At the same time, operating costs were cut by 9.5 per cent, as a result of streamlining business procedures and a voluntary exit scheme that saw 522 employees take early retirement.

Patsalides cited a number of projects implemented by CyTA in 2015, including expanding broadband connectivity, installing the 4G/LTE network, upgrading Cytanet’s Livestreaming service and adding content, and boosting Internet Cloud services.

In his own recent report on the state of CyTA, the auditor-general had painted a not-so-rosy picture. The official highlighted in particular that the organisation’s subsidiary in Greece, CyTA Hellas, continued to bleed.

At the end of 2015, the auditor-general reported, CyTA Hellas posted a negative working capital – its current liabilities exceed its current assets – of €50.1 million, indicating it was unable to meet its obligations without financial support from the parent company.

To date, CyTA has funnelled some €200 million into its subsidiary.

Under the terms of the 2013 bailout, Cyprus was to raise €1.4 billion by privatising state-owned companies, including CyTA, the power utility and the commercial operations of the Limassol port.

In March this year, faced with trade union opposition, the government withdrew a batch of bills relating to CyTA’s privatisation, in what may have been a tactical manoeuvre.

In April, opposition parties passed a law prohibiting the privatisation of CyTA and power company EAC until the end of 2017.

The President refused to sign off on the law and referred it to the Supreme Court.

 

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