BTC anticipates better 2009 Performance

(Nassau, The Bahamas) The Bahamas Telecommunications Company Ltd. (BTC) indicates that it is “cautiously optimistic” that fiscal year 2009 will witness a marked improvement in profit performance over the 2008 numbers despite the ongoing economic recession in the Bahamas.

Kirk Griffin, Acting President and CEO, responded today to the press reports of yesterday’s tabling of the BTC 2008 annual report in the House of Assembly. “The truth of the matter is that BTC - like companies all through the Bahamas and all over the world – faced a difficult 2008 due to the severe downturn in the global and national economy.” noted Griffin.

“As people travelled less, it meant that there were less tourists making calls in the Bahamas. This translated into a sizeable fall-off in our roaming revenue. As businesses contracted and laid staff off, it meant that there was less money in the economy for persons to spend on phone cards, new cell phones and the like. It really is that simple.” continued Mr. Griffin. BTC added that it has not been standing idle in the face of the ongoing sluggish economy and that the company has been adjusting accordingly to improve its revenue prospects.

“We didn’t stand idly by as we watched the economy deteriorate. The Board and Management of BTC took decisive actions to bolster exposure of promising product lines within the marketplace, while at the same time, the company took aggressive action to reduce and contain costs without eliminating any of its product offerings.”

“Because of steps that were taken beginning late last year, at the end of September our operating expenses are tracking at $8 million below the approved 2009 budget due to enhanced cost-cutting activities. At the same time, our revenue is up by some $8 million above budget due to targeted and sustained marketing and promotional activities. So even as the economy has yet to rebound out of the most severe recession since the Great Depression, we are tracking for profitability that would be substantially higher than the $21 million earned in 2008.”

“The reason that we temper our optimism with caution is because we recognize that the months of September through November are traditionally challenging months for cellular revenue due to low tourism arrivals and seasonally adjusted employment in the industry. Thus, while we feel good as to where we are, we are mindful that the economy is still stressed and we cannot say with absolute confidence how the year will end up. Yet, with continued creative leadership and continued vigilance on our expenditure, I am hopeful that we will be able to end the year with profits approaching the $40 million range – more in line with the profits earned in 2006 and 2007”, stated Griffin.

The company notes that it even with its ambitious cost cutting exercise and profit targets, it remains mindful of the economic realities facing its customers. In December 2008, the company dropped its fees on mobile caller ID, call waiting and voicemail, giving back to its customers some $6 million in projected revenue for 2009. The company cut its SMS [texting] rate from $0.10 to $0.05 and increased the bucket of minutes in its post-paid packages, effectively reducing the overage fees it would otherwise earn from customers.

On this point, Mr. Griffin adds: “So even while we are cutting costs and seeking to shore up revenues, we recognize that persons are having a difficult time in this economy. Thus, even with no mandate or competitive pressure to do so, we have searched hard to find ways to ease the burden where possible for our customers. “