ISTANBUL, Feb 27 (Reuters) - Turkey's leading mobile firm Turkcell TCELL.IS(TKC.N: Quote, Profile, Research) posted a 54 percent rise in net profit to $1.4 billion in 2007 and revenues rose 35 percent to $6.3 billion due to higher usage and subscriber growth.
But the company said it expected the mobile phone market in Turkey to grow at a slower rate this year.
Fourth-quarter net profit rose 39 percent from a year earlier to $403.2 million while revenues during the quarter jumped 50 percent to $1.8 billion, Turkcell said in a statement.
Earnings before interest, tax, depreciation and amortisation (EBITDA) rose 44 percent in the full year to $2.6 billion, with the EBITDA margin standing at 42 percent. In 2008 it expected the margin to be a few points lower.
The subscriber base grew 11 percent on an annualised basis to 35.4 million as of end-2007. Average revenue per user (ARPU) -- a closely watched measure -- rose 18 percent to $14.3.
Sounding a cautious note, Chief Executive Officer Sureyya Ciliv said in the statement there had been a downward trend in consumer sentiment in Turkey since the beginning of 2008 while concerns over the state of the global financial markets have increased.
The Turkish GSM market as a whole had continued strong subscriber growth last year, with the mobile line penetration rate reaching 88 percent by year-end, he said.
"In 2008, we anticipate growth in the Turkish GSM market to continue although at a slower pace relative to 2007, and we expect the mobile line penetration rate in Turkey to reach about 100 percent," Ciliv said. Continued...
The annual churn rate, which measures customers leaving the operator, increased to 19.9 percent at end-2007 from 14.7 percent a year earlier, in line with its expectations, as competition intensified, it said.
Turkcell faces increasing competition from Vodafone Group Plc (VOD.L: Quote, Profile, Research) and Avea, Turkey's third largest GSM operator.
Turkcell said its revenue growth also reflected the contribution of consolidated subsidiaries. Revenues at Ukrainian subsidiary Astelit surged 191 percent to $256 million.
In the fourth quarter, Astelit recorded positive EBITDA for the second consecutive quarter since it started operating.
Turkcell said it expected to spend approximately $800 million in operational capital expenditures in Turkey in 2008, including 3G and broadband capital expenditures, but excluding any potential 3G licence fee.
Astelit was expected to spend approximately $250 million in capital expenditures in Ukraine.
Turkcell's major shareholders are Nordic telecommunications company TeliaSonera AB (TLSN.ST: Quote, Profile, Research), Russian private equity firm Altimo and unlisted Turkish conglomerate Cukurova. (Reporting by Daren Butler, editing by Richard Chang, Leslie Gevirtz)