Algerian mobile operator, Djezzy has benefitted from its investment in data capacity with the latest revenue figures indicating a 57.6% increase mobile internet usage, despite a 4.9% reduction in network subscribers during Q2 to the end of June.

Djezzy has approximately 15.5 million subscribers in Algeria, boosted by an increase in data usage to 478MB per user according to global telecom operator and Djezzy's parent company Veon.

Data revenue growth has also accelerated to 88.9%, the company said on Thursday, explaining that this was "due to higher usage and a substantial increase in data customers as a result of the 3G and 4G/LTE network roll-out" across the country.

By the end of the second quarter 2017, Djezzy's 4G/LTE services covered 20 wilayas, which is over 20.5% of the country's population.

3G network coverage had been extended to all of the country's 48 wilayas.

In the first half period of the current year, revenue for Djezzy declined to US$463 million compared to US$529 million in 2016. The second quarter revenue figures dipped from US$251 million to US$231 million.

The 2017 interim EBITDA earnings also slowed down from US$286million in 2016 to US$219 million. However, on average, the telco's subscriber raised minutes of use by 11.8% to 379 minutes per user for the period.

"Total revenue decreased 8% as Djezzy continues to operate in a challenging environment with high inflation, an increase of VAT and of taxes on recharges following the new Finance law implemented on 1 January 2017, and also characterised by intense competition on data pricing in particular," Veon said.

It expects the competitive pressure in the Algerian market to continue, although management says it is taking corrective measures to turn the business around.

With effect from January 2017, the new Finance law increased VAT from 7% to 19% on data services and from 17% to 19% on voice services and also raised taxes on recharges from 5% to 7%.

"These higher indirect taxes influenced Djezzy's performance in relation to both revenue and EBITDA as these taxes could not be passed on to customers," Veon said.