Turk Telekom Reports Jump in Third-Quarter Profit

By Emre Peker

ISTANBUL--Turk Telekomunikasyon AS (TTKOM.IS), Turkey's biggest landline operator and internet-service provider, reported late Wednesday a 35% jump in third-quarter net profit, with its mobile and broadband businesses driving growth.

Net income for the three months to September was 319 million Turkish liras ($142 million), in line analyst forecasts, and higher than the TRY236 million profit posted in the same period last year, the Istanbul-based company said. The operator is 55% owned by Saudi Oger Group, with Turkey's Treasury holding a 30% stake and the remaining shares trading publicly.

Turk Telekom's revenue rose 4.4% on the year to TRY3.5 billion in the third quarter, according to a statement on the company's website. Mobile sales jumped by 18% annually and the broadband business clocked a 10% increase in the same period, the operator said.

"In the past 12 months, we have successfully implemented our scale building strategy while protecting our profitability. The outstanding 2.1 million net [mobile user] additions in this period while holding on to our EBITDA margin is a proof that we are on the right track," Turk Telekom said.

Still, some analysts maintained their neutral stance on the operator, citing challenges on the fixed-voice business, where revenue declined by 10% on the year.

Istanbul-based Tera Brokers said it maintains a TRY7.5 target price for Turk Telekom shares, compared with the company's Wednesday close of TRY6.01. The stock rose 0.5% to 6.04 in its first trade Thursday.

Write to Emre Peker at [e-mail]

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