OTE’s revenues drop 5.2%, influenced by Romanian wholesale rates

8 Aug 2014

Greek telecoms group OTE recorded a 5.2% drop in total consolidated revenues in Q2 2014 to EUR950.6 million (USD1.271 billion), on the back of the ‘challenging macroeconomic, competitive and regulatory environment’ in its operating countries Greece, Romania and Albania. OTE noted that excluding the impact of recent changes in wholesale network termination rates (mainly referring to a Romanian fixed and mobile rate drop on 1 April 2014), group revenues would have reduced by 3.5%. Consolidated EBITDA fell by 2.1% year-on-year in Q2 to EUR342.5 million, while net income stood at EUR69.3 million, down 44% compared to the year-ago quarter (although up 21% compared to the preceding quarter).

In Greek fixed network operations, net broadband additions in the quarter reached 34,000 (which OTE claimed represented around 46% of total market net additions – a higher share of the market growth than in recent quarters despite aggressive competition). OTE’s VDSL offering, launched in late 2012, had attracted more than 68,000 subscribers by the end of June 2014. Pay-TV subscribers (largely satellite-based, plus IPTV) continued to grow, adding 17,000 new customers in the quarter to pass the 300,000 subscriber mark. Greek fixed EBITDA rose by 3.6% in 2Q14, raising EBITDA margin to 37.0%. At Greek mobile unit Cosmote, revenues were down 7.5% quarter-on-quarter and 6.8% y-o-y in 2Q14 to EUR312.8 million; while revenue comparisons were no longer impacted by mobile termination rate (MTR) cuts implemented through early 2013, the drop in revenues reflected ongoing difficult economic conditions and heightened competition in the Greek market, the report stated.

At Romanian fixed line subsidiary RomTelecom, revenues increased by 4.1% y-o-y and 0.7% q-o-q in Q2 2014 to EUR149.7 million, a third consecutive quarter of growth ‘as a result of sustained ICT and wholesale revenues’. Cosmote Romania saw a drop (down 8.8% q-o-q) in its mobile service revenues to EUR101.6 million during the quarter, reflecting the steep MTR reduction implemented in April; excluding the MTR impact, Cosmote Romania would have posted a further successive quarter of revenue growth, OTE noted (while y-o-y, revenue was virtually flat).