Telekom Austria Group revenues drop 2.9% in 1H11; net loss reported after restructuring costs in home market

17 Aug 2011

Telekom Austria has reported group revenues of EUR2.23 billion (USD3.21 billion) for the six months ended 30 June 2011. This figure represents a decrease of 2.9% compared to the EUR2.29 billion generated during the first six months of 2010. The company blames the slump on regulatory cuts, fierce competition and the devaluation of the local currency in Belarus. Meanwhile EBITDA dropped 7.8% year-on-year, to EUR777.6 million, with positive contributions from Telekom’s ‘Additional Markets’ (Serbia, Slovenia, Macedonia) unable to compensate for lower results in Austria, Bulgaria, Croatia and Belarus. The company’s operating income dropped 85.8%, to EUR42.7 million, primarily as a result of restructuring charges that were recorded in the firm’s domestic market. As a result, Telekom reported a net loss of EUR59.2 million for the six-month period under review, compared to a EUR159.9 million profit during the corresponding period one year earlier. Capital expenditure (CAPEX) decreased 6.5% year-on-year to EUR763.6 million, primarily due to lower network investments in Croatia and Belarus.

In operational terms, Telekom’s domestic mobile subscriber base increased by 4.6% y-o-y to reach 5.18 million, with mobile broadband customers increasing 19.7% to 702,300 at end-June. Telekom’s fixed access lines grew 0.8% to 2.32 million, and its broadband subscriber base increased accordingly, growing 11.6% to 1.22 million. In Bulgaria, Mobiltel’s subscriber base increased 1.0% to 5.30 million customers; 3G exhibited a strong performance during the twelve months ending 30 June, with the subscriber base growing 121.5% to 161,600. During the same period, Velcom, Belarus’s number two operator by users, increased its mobile subscriber base by 7.6% to 4.46 million, supported by strong growth of mobile broadband customers, to 275,400. Vipnet, the second largest mobile operator in Croatia, increased its subscriber base by 1.0% to 2.07 million customers, while its 3G subscriber base increased by 17.3% to 165,700. Si.mobil, the second largest operator in Slovenia, increased its subscriber base 6.9% to 632,700 customers, with mobile broadband users up 19.4% to 15,300 during the corresponding period. VIP Mobile, the third largest mobile operator in Serbia, continued to grow its mobile subscriber base, which stood at 1.51 million at the end of June 2011, a rise of 19.1% year-on-year. Finally, Macedonia’s number three player VIP Mobile, grew its subscriber base to 504,900 customers at the end of 1H11.

Austria, A1 Telekom Austria Group