Bangladesh Telecommunications Company Limited’s revenue slumped 22.23 percent to Tk 886.81 crore last fiscal year, in yet another emblem of the steady decline of the once hugely profitable state-owned enterprise.
In fiscal 2008-09, when it was declared a company from a state organisation, its revenue was Tk 1,689.36 crore and net profit was Tk 106.15 crore. Ten years later, it incurred a loss of Tk 389.39 crore.
The company is at a disadvantage for its ageing assets: in fiscal 2018-19 it had to write off Tk 560.73 crore for depreciation, according to its annual report.
Of BTCL’s total revenue last fiscal year, 58.15 percent came from depreciation of its assets and establishments: Tk 560.73 crore.
“Our vast assets have become our liability,” said Md Rafiqul Matin, managing director of BTCL.
The depreciation was Tk 591.61 crore in fiscal 2017-18, Tk 485.83 crore in 2016-17, and Tk 514.51 crore in 2015-16.
“Our cash flow is quite satisfactory but when the depreciation issue comes up we become a loss-making company,” Matin said.
Since fiscal 2015-16, BTCL suffered losses of about Tk 1,200 crore.
In one year the state-run landline provider’s depreciation was much higher than its actual revenue: in fiscal 2014-15 BTCL’s total revenue was Tk 504.49 crore and the depreciation was Tk 563.13 crore.
The state-run company now has 5.5 lakh subscribers.
“BTCL has huge physical infrastructure like buildings and their value is declining every year. We have to spend a huge amount for their maintenance,” Matin added.
However, some BTCL officials raised doubts about the huge sums of deprecation shown in the books every year.
“The officials related with the process may be indulging in a spot of financial doctoring. The government needs to investigate it,” said one official, on condition of anonymity.
With a view to giving a boost to BTCL’s fortunes, the government has recently decided to make landline connection and re-connection free of cost to boost the user numbers.
The company is also suffering for a lack of steady leadership, the BTCL official said.
In the 11 years BTCL has been a standalone company, as many as 19 individuals have occupied the top seat, with some being re-appointed multiple times.
Telecom Minister Mustafa Jabbar acknowledged this continuity void.
“The government cannot always choose the best leaders, but fortunately this time a young leader has tightened the ship.” BTCL is a government-owned company, so it has additional responsibilities that private companies do not have.
“Its performance should not be compared with the private players’,” the minister said, adding that the matter of depreciation is being looked into.
He is hopeful that the depreciation charges will come down gradually. “On top of that we are trying to ensure efficiency,” Jabbar added.
Source: The Daily Star.