KPN raises year end targets

22 Aug 2003

Dutch telco KPN has beaten analysts expectations, reporting a second quarter net profit of EUR192 million compared to a net loss of EUR79 million a year earlier when the company wrote down the value of its 3G investments in Germany and Belgium. In response to the better than expected results KPN has raised its year end target for pretax profit to EUR1.4 billion from the EUR1 billion it predicted at the end of May. According to Chairman and CEO Ad Scheepbouwer, his strategy of job cuts, debt reduction and writedowns has been key to turning the company around. Indeed in 2002, the company had something of an annus horribilis, reporting its largest loss by a Dutch company ever.

During the three months ended 30 June 2003 KPN Mobile, the parent company’s wireless arm added 400,000 customers to take its total to 14.8 million. Of these, 4.92 million were domestic customers, 7.72 million were connected to the E-Plus network in Germany while its Belgian subsidiary BASE claimed 1.1 million. The total number of fixed line customers fell by 100,000 to 7.8 million, with PSTN lines in service declining from 6.4 million to 6.2 million. Demand for ADSL services remained strong, however, with the company reporting 513,000 lines in service mid-year; KPN expects this figure to have increased to 675,000 by the end of the year.