15/04/2013 15:52
Cyta seems to suffer a big blow from the Eurogroup decision.
The Authority, according to Deputy CEO Giorgos Koufaris, had cash available of €42 million in Bank of Cyprus and €14 million in Cyprus Popular Bank.
A total of €750 million relating to the Pension Plans of Cyta was dispersed to various banks.
Of Cyta’s pension fund, €72 million were deposited in Bank of Cyprus and €84 million in Cyprus Popular Bank while €28 million was invested in bank securities of Bank of Cyprus, Laiki and Hellenic Bank.
Another €20 million, which was liquidation of the government’s guarantee on the issue of Lefko, has been affected by the developments of recent days.
Chairman of the House Finance Committee and Democratic Party MP, Nicolas Papadopoulos said that there is a loss of revenues and expenses of the organization, adding that the budget had been prepared before the developments of last March and there may be variations in the data.
He also noted that the coverage of losses in the pension fund of Cyta, both for deposits and the amounts lost from investments in shares and securities banks, has not been clarified yet.
Plans to reduce costs
According to Mr. Kittas, Cyta proceeds with the preparation of new business plans adapted to the new conditions in order to reduce costs which will allow offering lower prices to achieve customer retention and revenue.
He noted that actions to reduce costs include reducing the cost of personnel, while the budget already includes an allocation of €9,5 million, which will be used for staff leaving.
He revealed that further reductions in the salaries of employees, after prior dialogue with the trade unions, are under consideration.
Chief Executive Officer of Cyta, Aristos Riris noted that the €9,5 million will cover over 120 retirements. “In order to fill the vacancies that will arise, hourly staff with lower rates and reduced benefits will be selected”.
“At the same time, there is a slight decrease in revenues from mobile telephony, particularly on international calls”, he added.
Cyta Hellas profitable in 2013
Cyta Hellas is expected to be profitable in 2013, according to Chairman of the Board, Stathis Kittis.
“The majority part of the main investments has been completed and expansion projects of optical network which are underway are the culmination of the overall planning and will be completed over the next three years”.
“New investments are made on a smaller scale and targeted projects”, he added.
"With the first signs of 2013," he said, "it appears that operating profitability has been consolidated and it is expected that the first use with EBITDA will be positive for the full year 2013," adding that "the company's turnover in 2012 exceeded €90 million from €55 million in 2011, an increase of 63%”.
He also said that Cyta Hellas currently has no need of financial aid for new investments since the construction of telecommunications infrastructure is on completion, however, there is a need to support the company's working capital to meet the anticipated increase in customer acquisition costs of mobile telephony and needs for necessary expenses to large business customers such as initial funding of projects and letters of guarantee.
In 2012, according to Mr. Kittis, the surplus after tax from operations of Cyta is expected to reach €61 million compared with €73 million in 2011 and €66 million foreseen in the budget.
Regulator pulled their ear
It is worth noting that the Regulator sent a letter to the Authority for the reduction of tariffs due to the crisis, according to Cyta Chairman.
According to Mr. Kittis, the Regulator advised them the same practice of reductions followed by the Authority for the consumers and the competing companies of Cyta.
The Authority, according to Deputy CEO Giorgos Koufaris, had cash available of €42 million in Bank of Cyprus and €14 million in Cyprus Popular Bank.
A total of €750 million relating to the Pension Plans of Cyta was dispersed to various banks.
Of Cyta’s pension fund, €72 million were deposited in Bank of Cyprus and €84 million in Cyprus Popular Bank while €28 million was invested in bank securities of Bank of Cyprus, Laiki and Hellenic Bank.
Another €20 million, which was liquidation of the government’s guarantee on the issue of Lefko, has been affected by the developments of recent days.
Chairman of the House Finance Committee and Democratic Party MP, Nicolas Papadopoulos said that there is a loss of revenues and expenses of the organization, adding that the budget had been prepared before the developments of last March and there may be variations in the data.
He also noted that the coverage of losses in the pension fund of Cyta, both for deposits and the amounts lost from investments in shares and securities banks, has not been clarified yet.
Plans to reduce costs
According to Mr. Kittas, Cyta proceeds with the preparation of new business plans adapted to the new conditions in order to reduce costs which will allow offering lower prices to achieve customer retention and revenue.
He noted that actions to reduce costs include reducing the cost of personnel, while the budget already includes an allocation of €9,5 million, which will be used for staff leaving.
He revealed that further reductions in the salaries of employees, after prior dialogue with the trade unions, are under consideration.
Chief Executive Officer of Cyta, Aristos Riris noted that the €9,5 million will cover over 120 retirements. “In order to fill the vacancies that will arise, hourly staff with lower rates and reduced benefits will be selected”.
“At the same time, there is a slight decrease in revenues from mobile telephony, particularly on international calls”, he added.
Cyta Hellas profitable in 2013
Cyta Hellas is expected to be profitable in 2013, according to Chairman of the Board, Stathis Kittis.
“The majority part of the main investments has been completed and expansion projects of optical network which are underway are the culmination of the overall planning and will be completed over the next three years”.
“New investments are made on a smaller scale and targeted projects”, he added.
"With the first signs of 2013," he said, "it appears that operating profitability has been consolidated and it is expected that the first use with EBITDA will be positive for the full year 2013," adding that "the company's turnover in 2012 exceeded €90 million from €55 million in 2011, an increase of 63%”.
He also said that Cyta Hellas currently has no need of financial aid for new investments since the construction of telecommunications infrastructure is on completion, however, there is a need to support the company's working capital to meet the anticipated increase in customer acquisition costs of mobile telephony and needs for necessary expenses to large business customers such as initial funding of projects and letters of guarantee.
In 2012, according to Mr. Kittis, the surplus after tax from operations of Cyta is expected to reach €61 million compared with €73 million in 2011 and €66 million foreseen in the budget.
Regulator pulled their ear
It is worth noting that the Regulator sent a letter to the Authority for the reduction of tariffs due to the crisis, according to Cyta Chairman.
According to Mr. Kittis, the Regulator advised them the same practice of reductions followed by the Authority for the consumers and the competing companies of Cyta.
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