Thaicom Public Company Ltd., which owns a majority stake in local phone operator Mfone, announced on Friday that they have devalued the company by about $1.31 million as profits in the first quarter dropped by half.
“In an effort to reflect the fair value of its business operations and holdings, the company also reviewed all its investments and decide to include an impairment loss on the company’s investment in telephone operation in Cambodia,” the statement said, adding that profits dropped from about $2.66 million to $1.34 million over three months.
The disappointing news for Mfone comes less than two months after the Minister of Posts and Telecommunications, So Khun, said that Thaicom was currently negotiating to sell the company to locally owned operator Qb.
Atip Rittaporn, managing director at Shenington Investments, Mfone’s holdings company, would not comment on the possible sale, but said that the revenue drop comes as a direct result of ongoing price dumping in the sector caused by an oversaturation of mobile phone operators in the Cambodian market.
“The environment is not what it used to be. It is just the way it is right now. There are too many operations,” he said. We are currently analyzing very hard how the industry will be in the future, but right now there is no clear direction. We will wait and see.”