Orascom Telecom Holding posts net loss of $58 million

Orascom Telecom Holding (OTH), the Global System for Mobile Communications (GSM) service provider, posted net losses of $58.5 million in the second quarter of 2011 despite improvement in its operational performance. The loss came on the back of the application of the new tax law which resulted in $58 million in additional taxes, almost wiping off the gains from the sale of OTH's Namibian unit.

Another factor that led to the loss is the higher-than-expected interest expense, $129 million, in relation to the refinancing of OT's debt, to comply with its deal with VimpelCom. Moreover, the company shouldered forex losses from associates of $17 million.

These losses came despite the robust performance on the revenues' level in Algeria. Revenues from Djezzy through the second quarter came at $477 million, 5.3 per cent higher than the first quarter and 4.2 per cent higher than the same quarter of 2010 thanks to the tight cost management in Algeria and the phasing out of marketing expenses related to the ban on advertising on national Algerian TV.