Four years have passed since government took over BTL in 2009. Since then, the company has faced myriad legal entanglements with the Ashcroft Alliance, but operationally it's been smooth going. And that's because after going through Ashcroft, Prosser, back to Ashcroft and then to Government, BTL's staff have learned how to manage change like pro's. That has keep the company profitable - and to keep shareholders interested, the government controlled company put back in the provision in its articles which ensures that a dividend of no less than 45% of profits is paid annually. That's why there's always a nice crowd at the Annual General Meetings, and it was no different last night as Jules Vasquez found out:...
Jules Vasquez reporting
BTL's 7th Annual General meeting drew a good sized crowd of regular small shareholders for the country's largest publicly held company.
And while the crowd was good, the news wasn't great. The Board of Directors reported that the company's profits were down by 5.5 million, its gross earnings down by 1.5 million and its earnings per share down from 53 cents to 42 cents.
But, despite that glum news, shareholders took home a fatter dividend of 25 cents per share.
Nestor Vasquez, Executive Chairman, BTL
"Twenty five cents per share is the highest we have paid since we were appointed in 2009. This twenty five cents is about almost 59% of the profit. The profits have drop and we are now giving a bigger share in dividends."
Anwar Barrow, Board Member, Executive Committee, BTL
"Twenty five cents per share represents a 5% cash return on your $5 investment if you bought in at $5. Last fiscal year it was at 4.7% return. This year is actually a better cash return that is better than last year even though the profits has reduce somewhat."
And while there was good fun and giveaways amongst the BTL family, Executive Committee member Anwar Barrow conceded that there are challenging times at hand and ahead:
Anwar Barrow, Board Member, Executive Committee, BTL
"Since the government has taken over BTL we have been reducing rates and trying to bring the company more in line with global technology and telecom standards especially as far as rates. That has affected the company somewhat."
Jules Vasquez
"Is BTL seeing a migration away from traditional services and revenue centers such as texting and long distance calling? These are now being supplanted by internet base services. Is there sufficient uptake of the new data service to replace the revenue that is being lost in these traditional revenue centers?"
Anwar Barrow
"So far the uptake has been positive, but to pass a final analysis it's really too early to tell. VOIP was just opened up this year, so that is the big counter balance and what we have to do is sell more data services to compensate for that."
The Liberalization is probably the most consequential development in the telecoms landscape that is sure to hurt BTL's earnings. Director Barrow was circumspect about its likely effect on earnings:
Jules Vasquez
"Are we looking at another year when we will have a downturn in profits and might it be much more significant than it is this year?"
Anwar Barrow
"It is too early to say. We are only 6 months into the new financial year."
Jules Vasquez
"However, have you all made a forecast?"
Anwar Barrow
"Yes, we've made a forecast. We make forecast every year."
Jules Vasquez
"What is the forecast saying?"
Anwar Barrow
"I wouldn't want to get in the forecast at this point."
Jules Vasquez
"Obviously the industry has changed so significantly since you started charging per second and also now the second most consequential development is the liberation of VOIP. Has anyone made a calculation of how much the advent of those two things has cost or will cost the company in revenue over let's say a 5 year period?"
Anwar Barrow
"We have look at the numbers. But, Jules, it's about evolution."
Jules Vasquez
"Why don't you want to discuss the numbers?"
Anwar Barrow
"Because the numbers are delicate - they are only forecast."
Jules Vasquez
"The company is public."
Anwar Barrow
"They are something you usually keep internal. They are not certain and people want certainty. In terms of the future, what I can say is that we expect to be in a similar range of profits as we were last year."
And while that's hopeful news for shareholders, for the hundreds of thousands of regular customers - they just want back their triple up, but right now BTL says the company can't afford it anymore:
Anwar Barrow
"In terms of the "Triple Up" - it will return. We are making some internal adjustments. It might not be as often as it used to be because it's really uneconomic for the company to do the "Triple Up" as they were doing it in the past. With the opening up of VOIP and the lowering of rates, we cannot afford to it at the same rate."
And so while triple up is on hold probably till the end of the year - the company pledges that it's profits are stable, if not growing:
Nestor Vasquez, Executive Chairman, BTL
"We expect our company and business to grow in its resiliency, quality and affordability for our customers while yielding just return for you our shareholders."
Executive chairman Nestor Vasquez also announced plans for the development of a fiber to the home network and the introduction of IPTV - which is internet protocol TV.
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