KPN Q2 profit down 12%; raises Dutch EBITDA forecast

23 Jul 2008

The Netherlands largest telecoms group by revenues, Royal KPN, said its net income for the three months to June fell 12% year-on-year as a result of higher tax expenses and operating costs, but raised its full-year 2008 EBITDA guidance for domestic earnings to ‘flat’ from a previously anticipated decrease. The telco’s net income fell to EUR353 million (USD557 million) in the second quarter, down from EUR401 million in the corresponding period of 2007, despite a 22% rise in turnover to EUR3.66 billion – driven by its EUR766 million acquisition of Hague-based computer-services provider Getronics last year. Group second-quarter EBITDA fell to EUR1.27 billion from EUR1.28 billion a year ago, broadly in line with market expectations.

The operator’s CEO Ad Scheepbouwer told reporters that new services introduced in its home market such as VoIP, IPTV and wireless broadband were expanding quickly while declines in its traditional core telephony businesses were slowing. Around 40,000 customers disconnected their fixed line in the April-June period, marking a steady improvement from the 165,000 who switched off in the first quarter of 2007. Meanwhile, revenues from wireless data almost doubled in the second quarter from the corresponding period a year ago, he said. EBITDA in KPN’s home market slipped by just point seven of one percent to EUR900 million in the period under review, eclipsing the EUR884 million figure forecast by analysts in a Bloomberg poll. KPN says EBITDA at the division will be ‘flat’ in FY 2008, at around EUR3.31 billion. Its previous forecast was for EBITDA to fall by up to EUR100 million.

Internationally, KPN’s German unit E-Plus added a net 780,000 customers in Q2, the biggest increase since 2000, and BASE in Belgium once again reported strong growth in service revenues.

Netherlands, KPN