Danish telco TDC, the country’s leading operator in terms of subscribers, has published its financial results for the three months ended 30 June 2014, reporting a 5.5% year-on-year drop in revenue to DKK5.668 billion (USD1.02 billion), down from DKK5.999 billion in 2Q13. The operator pointed out that the decline was an improvement on the 6.0% drop reported in the three months to end-June 2013. The slight improvement was down to a reduced impact from regulation, but partly offset by unfavourable exchange rates. In the period under review, the ongoing negative effects from regulation (mainly connected to international roaming charges and mobile termination rates [MTRs]) amounted to DKK114 million, contributing to 18% revenue decline, while the Norwegian Krone (NOK) and Swedish Krona (SEK) exchange rates effected revenues negatively by DKK100 million. Meanwhile, earnings before interest, tax, depreciation and amortisation (EBITDA) dropped 3.2% from DKK2.431billion in 2Q13 to DKK2.354 billion in the second quarter of 2014, while gross profit declined by 4.3% to DKK4.204 billion.
Further, the group has confirmed its 2014 guidance, forecasting that organic revenue will decrease less than its 2013 drop of 3.5%, while EBITDA and CAPEX are expected to reach DKK9.6 billion and DKK3.7 billion, respectively, by 31 December 2014. Carsten Dilling, president and CEO of TDC, added: ‘Q2 shows continued pressure on organic revenue and gross profit developing in line with 2013 full-year results. Yet, TDC Group delivered a strong cash flow, up 40.1% on Q2 2013 driven primarily by working capital improvements and savings of 5.8% in operating expenses. TDC Group confirms its 2014 guidance, including improved organic revenue developments in 2H 2014, due to a new iPad sales agreement and a number of price changes with effect from 1 July.’
In operational terms, TDC reported 2.148 million residential mobile revenue generating units (RGUs) at end-June 2014, down from 2.331 million reported in 2Q13; broadband RGUs dropped to 629,000, down from 642,000 at end-June 2013. Mobile APRU remained steady at DKK117 in the period under review, while broadband APRU increased marginally, at DKK182.