OTE revenues down 5.4%

7 May 2009

Greece’s dominant telecoms group OTE has posted a 5.4% year-on-year fall in consolidated first-quarter revenues to EUR1.45 billion (USD1.93 billion), as competition intensified in the Greek and Romanian markets, the company said in its report. OTE’s domestic and international mobile arm Cosmote saw revenues in the three months ended 31 March 2009 dropping by 4% to EUR716 million, largely reflecting lower handset sales, whilst Romanian fixed line subsidiary RomTelecom’s turnover fell by 8% on the back of a worsening economy. However, OTE’s quarterly group net profit was inflated by a voluntary retirement scheme cost reversal, jumping 89% year-on-year to EUR267 million, while operating income before depreciation and amortisation (OIBDA) rose by 35% to EUR721 million as operating expenses, excluding redundancy costs, fell by 9.3%. The telco stated that ‘in the first quarter, OTE Group revenues were adversely impacted by competitive, regulatory and economic developments across all its markets. In this rapidly changing environment, it is very difficult to make accurate forecasts regarding revenue evolution. Under the current circumstances, group OIBDA margin will be the main focus area of the company’s management… expected to be positively affected in the coming quarters, on a pro forma basis, by the impact of the additional voluntary retirement plan… and lower marketing expenses.’