UPDATE 1-Telecom Egypt staff pay demands weigh on profit

(Adds details, quote, share price)

CAIRO Aug 8 (Reuters) - Landline monopoly Telecom Egypt reported a 25 percent drop in second-quarter net income on Wednesday, pushed lower by weaker revenue and employees' demands for higher pay since the country's president was overthrown in a popular uprising.

Egypt's economy has been hit by political turmoil since Hosni Mubarak was ousted in February 2011. A new president took office in June but the transition has been marred by violence and rows between political groups and the ruling army.

Telecom Egypt said net income fell to 613 million Egyptian pounds ($101 million) from 813 million pounds in the second quarter of 2011.

Revenue dropped 7.9 percent to 2.4 billion pounds.

"Revenues are lower this quarter, primarily driven by the timing of international cable projects revenue recognition, and our cost base has been affected by a restructuring and annual increase of salary arrangements," Tarek Aboualam, Chief Executive Officer and Managing Director said in a statement.

Telecom Egypt said broadband services now account for almost 28 percent of revenue the firm generates from retail customers. It added 45,180 net new broadband customers during the second quarter, resulting in a 60.5 percent market share.

On June 30 2012 there were 7.6 million fixed-line subscribers.

The firm's shares closed down 2.7 percent on Wednesday. The main index fell 1.1 percent.

($1 = 6.0770 Egyptian pounds) (Reporting by Tom Pfeiffer and Shaimaa Fayed; Editing by Erica Billingham)