(MENAFN- Muscat Daily) Oman Fiber Optic Co (OFO) posted a net profit of RO4.26mn for the year 2013, compared with a net loss of RO1.56mn in the previous year.
The company's loss during the previous year was due to the writing off of assets and inventory amounting to RO4.72mn, due to a fire in October 2012 that completely damaged its production plant in Rusayl Industrial Estate.
The turnover of the company for the year showed an increase of eight per cent to RO26.95mn, compared with the previous year's turnover of RO25mn, despite the stoppage of cable production due to the fire incident.
The company has recognised RO2.8mn as insurance claim income for the year 2013.
''At the end of the year, with regard to the insurance settlement, OFO has reached a settlement agreement that enabled the company to settle the dispute with the insurance company for the validity of insurance policies and received part of the compensation as per the settlement agreement terms, and accordingly, the company withdraws its suit from the Primary Court,'' OFO said in its Director's report.
With regards to rebuilding the factory, OFO said that it has initiated the execution of the first stage. ''The first stage includes the construction of the fiber optic cable plant building, which has been completed, with the installation of machines and equipment now in progress. Commercial production is expected to start in Q1 2014.'' The company said, ''The second stage includes the construction of a fiber plant (raw material for manufacturing fiber cable) and the company's administration office that will start in the first quarter of 2014.''
The OFO board of directors recommended a cash dividend of 35 per cent and stock dividends at 15 per cent for 2013.
The company said that the active presence of Indian and Korean cable manufacturers in the Middle East market, and the expected entry of new cable facilities in Saudi Arabia and East Africa will affect the supply-demand situation leading to fierce competition in the region.
''OFO is focusing on other emerging markets to balance out this situation. Opportunities for the telecom services business are expected to increase as many infrastructure projects, such as broadband solutions, railway, border security and airport infrastructure are being developed within the next three-five years.''&n
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