Telenor revenue up in 1Q16 on positive currency effects, Myanmar and Bangladesh contributions

27 Apr 2016

Norway’s Telenor Group recorded revenues totalling NOK33.013 billion (USD3.82 billion) in the first three months of 2016, up from a restated figure of NOK31.446 billion in the corresponding period a year earlier. With revenues increasing by around NOK1.6 billion, the group noted that NOK1.0 billion of that was due to positive currency effects, while it also pointed to ‘significant positive contribution’ from its subsidiaries in Myanmar and Bangladesh. Such positives meanwhile helped to offset ‘tough market conditions’ in Thailand, Denmark and Malaysia, as well as declining fixed revenues and the loss of a wholesale contract in its domestic market last year.

EBITDA before other items increased by 8.2% year-on-year, or NOK900 million, to NOK11.685 billion, with Telenor Group saying that underlying EBITDA improvement had mainly been driven by Myanmar and Bangladesh. Telenor Group’s EBITDA margin meanwhile improved by one percentage point, standing at 35% in 1Q16. Adjusted for one-time effects, operating profit totalled NOK6 .4 billion, while profit after taxes and non-controlling interests was NOK3.6 billion in the first quarter of 2016. Based on the company’s first quarter results, Telenor Group has reiterated its financial guidance for 2016, saying it expects an organic revenue growth in the range of 2% to 4% and an EBITDA margin of 33% to 34%, while the CAPEX to sales ratio is expected to be between 17% to 19%.

In operational terms, at the end of March 2016 Telenor Group’s mobile subscriber base totalled 207.976 million, representing an increase of 5.4 million from the end of 2015. Notable customer growth was reported in Pakistan (up 2.2 million subscribers quarter-on-quarter), Myanmar (up 1.8 million q-o-q) and India (1.5 million). Such gains helped offset small declines in a number of the group’s other operational areas, including Norway (down 34,000), Hungary (down 13,000) and Bulgaria (down 59,000).

Commenting on the company’s performance, Telenor Group Chief Executive Officer Sigve Brekke said: ‘During the first quarter of 2016, Telenor Group delivered 5% EBITDA and 2% revenue growth on an organic basis, and achieved a healthy operating cash flow of more than NOK6 billion. We connected more than five million new customers as we continue to improve our network and service quality across our footprint. With intense competition in several markets, driving profitable growth and keeping a close eye on costs continues to be a priority for me and my management across our European and Asian markets.’

Norway, Telenor Group