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Consolidated Results for Second Quarter 2011 - Telecom Egypt

Results of Telecom Egypt for the second quarter of 2011. Financial statements have been prepared in accordance with Egyptian Accounting Standards.
Commenting on the second quarter results of 2011, Akil Beshir, Chairman of Telecom Egypt (TE), said:

“While the immediate effects of the Egyptian revolution started to subside during the quarter, the prevailing operating environment has yet to normalize in Egypt. Government curfews were fully lifted in mid June, but tourism levels and business activities remain low and we continue to experience higher levels of copper cable theft than would be the case under normal conditions.

“While management has worked hard during the period to stabilize our operations and manage this highly fluid situation with sensitivity, there are still many things to work through. For example, the free reconnections we made in interests of public safety and security during the height of the disruptions in Egypt have yet to fully work through to our subscriber base. Some have already returned as active customers. I expect that, as a result, there will be some further movement in the overall total number of subscribers we report today over coming quarters.

“Yet, it is during this continued period of disruption, that TE has delivered quarteron-quarter revenue growth of more than 8.5% and a net profit margin of 31.7%. This is once again testament to our people, our service and our foresight in the projects and investments that have made TE a well-diversified business.

“The impact on overall revenue performance of the factors affecting our domestic market has been mitigated by our international wholesale business and the first service revenues recognized from our cable business.

“Vodafone Egypt (VFE) experienced a very strong period of customer additions during three months ended 30 June 2011, with closing customers reaching more than 34 million. Moreover, TE Data has been well positioned to absorb the increased demand for high quality internet services and has for the first time passed the milestone of one million ADSL subscribers during the second quarter.

“I am immensely proud of delivering such a strong financial and operational result in such an operating environment and feel confident that TE will continue to be one of Egypt’s best performing companies."