Analysts forecast KPN share issue, as Dutch telco looks to cut debt

4 Feb 2013

Reuters reports that Dutch telecoms group KPN Telecom (or Royal KPN as it is also known) could announce new plans to cut the group’s debt when it publishes its full-year financial results this week, with some analysts predicting the carrier could conduct a share issue. KPN, which is poised to publish is FY2012 results tomorrow, reported a debt to EBITDA ratio of 2.7 in the third quarter of last year, breaching its own target of 2.0-2.5 times debt. On the positive side, it has sold off a number of assets – including some Dutch and German mobile phone towers – but it also had to pay out more than expected (USD1.8 billion) for mobile frequencies in the 4G auction last December. In response to its recent woes, the group has trimmed its dividend for 2013 to EUR0.03 (USD0.04) from the original guidance of EUR0.35, but some analysts believe this may not go far enough.

Netherlands, KPN