Strong revenue growth for EuroTel Bratislava

12 Aug 2003

EuroTel Bratislava, one of Slovakia’s two incumbent mobile operators, has reported strong revenue growth of 25% for the second quarter of 2003, reaching SLK2.4 billion. The cellco attributed the upturn to growth in its customer base and an increase in pre-paid ARPU. EBITDA reached SLK1.07 million, up 35%, while operating profit stood at SLK417 million. The company recorded a net income of SLK308 million in the second quarter, up from SLK54 million at the same time the previous year. Net customer additions during the three month period totalled 58,423, a 38% rise over the 42,215 gained in the same period of 2002, taking the total customer base to 1.37 million.

In the Slovakian mobile market, EuroTel competes with just one other player, Orange Slovensko. EuroTel has been operating an NMT-450 network in the country since 1994 but both launched GSM services in 1997. Orange was quick to steal the top spot away from EuroTel, and at the end of June 2003 could claim a customer base of 1.85 million and a market share of 57%. The country’s cellular penetration rate stood at almost 60% at the same date, leaving limited room for development in the market; EuroTel and Orange saw their customer bases grow by 17.5% and 20.5% respectively in the year to the end of June 2003, compared to 53.5% and 58% the previous year. In the face of slowing growth, both operators are looking to focus on developing new services. The two were awarded 3G licences in June 2002 but are not required to launch services until 2005.

The government has tried, and failed, to introduce a third player to the mobile market on several occasions. The most recent attempt took place in 1999 when a tender for DCS-1800 frequency failed to attract a single bid. In March 2002 the TU SR launched a ‘beauty contest’ tender for GSM and UMTS concessions, awarding a combined GSM/UMTS licence to new market entrant two months later. Under the terms of its licence, Profinet was obliged to launch GSM services within six months of its award and achieve 20% population coverage within 18 months. However, in September 2002 the TU SR revoked the newcomer’s licence after it failed to come up with the first instalment of the licence fee in time. The full fee was SLK1.5 billion (EUR33.9 million) to be paid in three instalments. The regulator has not revealed any plans as to whether it would run another tender for the licence.

PriMetrica's Datafile of Eastern European Telecommunications