Despite Telenor Group reporting ‘steady performance’ in the first quarter of 2021, the impairment of the Norwegian telecoms giant’s Myanmar unit saw the company swing to a loss for the period under review. Highlighting the ‘irregular, uncertain, and deeply concerning situation’ in Myanmar, Telenor Group confirmed it had fully impaired Telenor Myanmar with an amount of NOK6.5 billion (USD783 million) in the quarter. In so doing, it noted: ‘Due to the worsening of economic and business environment outlook and a deteriorating security and human rights situation, we see limited prospects of improvement going forward.’ Further, with what the Norwegian company called ‘limited visibility on the development in the country’, it also confirmed it has now excluded Myanmar from its outlook, thought it said that for FY 2021, even when excluding Myanmar, it was reiterating its expectation of organic subscription and traffic revenues and EBITDA to remain around the 2020 level, while it forecasts a CAPEX to sales ratio of 15%-16%.
In terms of the key financial indicators for the first three months of 2021, the group reported a total turnover of NOK28.873 billion, down from NOK30.953 billion in the corresponding period a year earlier. Subscription and traffic revenues totalled NOK21.715 billion, meanwhile, compared to NOK23.867 billion in 1Q20. EBITDA before income and other expenses was also lower year-on-year, falling to NOK13.015 billion in 1Q21, with organic EBITDA declining by 2% on an annualised basis, attributed to the decline in subscription and traffic revenues, which was only partly offset by reduced operating expenses. On the back of the aforementioned impairment of Telenor Myanmar, the group reported a consolidated net loss of NOK3.889 billion for the opening quarter of 2021, compared to the net profit of NOK698 million reported for 1Q20. CAPEX excluding licences and spectrum totalled NOK3.745 billion in Q1 2021, yielding a CAPEX to sales ratio of 13%.
With regards to operational highlights, Telenor Group reported that the number of mobile accesses on its books grew by a net five million in the year to 31 March 2021, with it ending the reporting period with a consolidated mobile subscriber base totalling 186.783 million. Growth was ‘fully attributed to [its] operations in Asia, with Myanmar adding 2.0 million new subscribers, as well as Grameenphone in Bangladesh and Telenor Pakistan growing customer base by 1.7 and 1.3 million subscriptions, respectively’. Closer to home, Telenor Group said that in the Nordics its operations in Denmark and Sweden reported ‘a positive development’ with a total of 43,000 new subscriptions across both countries, though DNA in Finland and Telenor Norway both ended the quarter with a customer base decline.