The SLT Group, a Sri Lankan telecommunications conglomerate, faced a year of mixed performance in 2023. While the company implemented cost-saving measures and witnessed positive signs in its Mobitel subsidiary, overall revenue and profitability declined compared to 2022.
The year 2023 presented significant challenges for the SLT Group. The company’s consolidated revenue for the fourth quarter dipped by 7.5% year-on-year, translating to a decrease of LKR 26 billion. This decline came despite efforts to optimize costs, which resulted in a 5.9% reduction in operating expenses. Unfortunately, these savings were outweighed by the drop in revenue. Consequently, the Group experienced a loss of LKR 3.9 billion in 2023, a stark contrast to the LKR 4.8 billion profit recorded in the previous year.
While facing a decline in overall profitability, the Group did manage to achieve some cost reductions. At the SLT level, a 3.6% decrease in operating expenses was observed in the fourth quarter compared to the same period in 2022. This reduction stemmed primarily from effective management of staff costs, advertising expenses, and activation costs. Additionally, repair and maintenance costs also decreased during the latter part of 2023. However, these positive developments were insufficient to offset the negative impact of the falling revenue and rising depreciation.
Looking at the broader picture, the Group’s operational costs for the entire year 2023 saw a rise of 9.4% compared to 2022, reaching LKR 74 billion. This increase was primarily driven by factors like increased electricity tariffs and other annual maintenance and vehicle-related costs. The Group’s revenue for the entire year also experienced a marginal decline of 1.2% compared to 2022.
Despite the financial challenges, the CEO of the SLT-MOBITEL Group, Janaka Abeysinghe, remains optimistic about the future. He acknowledges the ongoing macroeconomic uncertainties but highlights positive signs for 2024. He emphasizes the Group’s commitment to continuous cost control measures and their adaptability to market conditions. Furthermore, he expresses confidence in the Group’s ability to overcome current challenges and drive long-term profitability, citing the positive trends observed in Mobitel’s performance as a source of encouragement.
While the SLT Group undoubtedly faced difficulties in 2023, the company’s ongoing cost-saving initiatives and the positive developments within its Mobitel subsidiary offer reasons for hope as they navigate the complexities of the current market landscape.