The telecommunications market still looks far from a steady recovery of profitability.
Although the full financial statements are not yet available, the data collected by Monitor show that the joint result of market operators last year was negative, influenced by the continuity of Albtelecom’s loss-making results.
In an interview with Monitor in April, One CEO Emil Georgakiev said his company achieved an EBITDA (profit before interest, taxes, depreciation and amortization) of around € 20 million. However, net profit i One, stripped of other indicators, is estimated to have been around 6 million euros.The profit of One is estimated to have increased by about three times compared to 2019, when it reported a profit of about two million euros.
According to still unofficial data, the largest operator in the market, Vodafone Albania, closed 2020 with a net result slightly higher than two million euros, down sharply from 2019, when it reported a net profit of about 12 million euros.
The third mobile communications operator, Albtelecom, is estimated to have closed 2020 with a loss of approximately 9 million euros, exacerbated by the again negative result of 2019, when net losses amounted to about 5.2 million euros. For more than a decade Albtelecom is suffering the heavy burden of spending on debt interest, but also the difficulties of gaining market share in the mobile segment.
One factor that explains the still fragile financial performance of the market is the decline in the revenue base. The mobile services market declined for the fourth consecutive year in 2020 and the total revenues of operators amounted to ALL 23.9 billion, down by 9% compared to a year earlier. But, according to data from the Electronic and Postal Communications Authority (AKEP), investments in mobile networks reached the value of about 56 million euros, an increase of 64% compared to a year ago.
Competition in the mobile market suffered a blow with the exit of the fourth operator, Plus Communication, at the end of 2017. But the change of ownership over the second operator, Telekom Albania in 2019, seems to have given another impetus to the competition between operators.
Moreover, in the annual report of 2020 AKEP expressed concern that competition is being accompanied by predatory pricing practices, which could harm especially the smaller operators and the overall ability of the market to provide sufficient profits to support new investments in it. the future.
The still not very satisfactory financial performance of market operators may be one of the reasons that has led to the postponement of plans for the release of new frequencies, mainly related to the implementation of the latest generation technology, 5G.