LIME Jamaica posted a J$1.3 billion loss for its second quarter ending September 2012, despite a 21 per cent growth in mobile revenues following the slashing of cell phone rates over the summer.
The response to a campaign around a new plan branded Talk EZ during the review period resulted in a 20 per cent growth in LIME’s mobile subscriber base.
However, the company blamed the financial loss in part on a new government tax, which came into effect in July.
"The special telecoms tax implemented in mid-July had a strong adverse impact on fixed voice revenue which declined 13 per cent," said LIME’s managing director Garfield Sinclair.
He added that broadband revenues also fell due to a net reduction in subscribers and lower priced packages.
LIME avoids disaggregating its revenue streams, but mobile accounts for a significant percentage.
Sinclair, however, disclosed that average revenue per user actually increased with the Talk EZ campaign by 11 and 6 per cent for prepaid and postpaid mobile customers respectively.
"The quarter ... continued the encouraging progress in the mobile line of business with a 21 per cent increase in mobile revenues over the same prior year period,” Sinclair said.
“We have seen strong traction for the LIME brand in the prepaid mobile market and LIME has stepped up to be the value operator in the Jamaica marketplace," he added, in a release accompanying the financials.
In June, LIME dropped its rates amidst an initiative by the Office of Utilities Regulation to set interim wholesale and retail telecommunications rates at $5 from $9, enabled by an earlier amendment to the Telecommunications Act.
The slash in rates represented the most aggressive move by LIME to win back market share from Digicel Jamaica, the nation's largest mobile phone network.
"Our focus on customer retention continues to yield positive results with churn (or attrition) reducing across all lines of business," Sinclair said.
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