Hrvatski Telekom (Reuters: HT.ZA; Bloomberg: HTRA CZ), Croatia's leading telecommunications provider, announces its audited results for the year ended 31 December 2016.
In 2016, Hrvatski Telekom generated revenue amounting to HRK 6.97 billion, which is by 0.7% above the 2015 results. HT has maintained its leading position in all segments of the telecommunications market, the main contributors being mobile and wholesale revenues, growth in the ICT segment, and the electricity business.
EBITDA before exceptional items amounts to HRK 2.82 billion, which is a 1.4% increase compared to 2015, along with a strong EBIDTA margin of 40.5%, which is 0.3 percentage points above the previous year.
2016 net profit amounts to HRK 934 million, which is HRK 9 million, i.e. 1.0 %, above 2015.
More than HRK 1.6 billion of investment in infrastructure and innovative services
Last year, Hrvatski Telekom increased investment to HRK 1.61 billion, or 9.1% compared to the previous year. Investment was focused on increase of the broadband Internet access capacity, customer experience improvement, and increase of competitiveness.
Investment in the fixed network resulted in fibre optic access for 295 thousand households, representing a 68% increase compared to 2015. Broadband access speeds were increased by two to five times as compared to the previous ones, free of charge, for more than 50% of customers.
NGA speeds above 30 Mbit/s were enabled, in total, for 800 thousand Croatian households, thus bringing Croatia closer to the European Digital Agenda targets.
In the mobile segment, 4G network coverage for download speeds of up to 225 Mbit/s increased to 51% of the population compared to 31% coverage at the end of 2015. 4G mobile network outdoor coverage increased from 93.1% to 96.9% compared to the previous year.
The new, unique concept of service offering on the Croatian telecommunications market, Magenta 1, launched in H1 2016, was accepted by more than 53 thousand households, and this number is steadily rising.
More than half of the profit for dividend distribution
The Management Board and the Supervisory Board have made a proposal to the General Assembly that dividend be distributed in the amount of HRK 6 per share, to be paid out of the 2016 net profit, which is a total amount of HRK 491.3 million (54% of net profit) earmarked for dividend payment, and that the remaining part of net profit amounting to HRK 417.5 million be allocated to retained earnings.
Furthermore, Hrvatski Telekom also announces its intention to launch a Company’s Share Buyback Programme at the Zagreb Stock Exchange, in line with the decision of the General Assembly of 21 April 2016 granting the Management Board authority to acquire Company's shares. Upon completion of all internal procedures and provided that market circumstances are satisfactory, the Company will announce the scope, volume, and duration of the Company’s Share Buyback Programme in accordance with the applicable legislative framework.
As previously announced, HT will, at the beginning of the year, announce a minimum target dividend for each year, which will be within the Dividend Policy range. For the financial year 2017, the Management Board currently expects the payment of dividend to a minimum amount of HRK 6.00 per share.
Regional expansion into Montenegro
In early January 2017, Hrvatski Telekom acquired a 76.53% stake in Crnogorski Telekom, for a purchase price of EUR 123.5 million. This transaction is part of the HT's growth strategy through expansion into regional markets. With this acquisition, HT expects to generate additional value for its shareholders and customers through substantial synergy effects.
In 2017, focus on customer experience and expansion of business operations
Commenting on the 2016 business results and plans for 2017, Davor Tomašković, President of the Management Board of Hrvatski Telekom, said:
“We look back at a very successful year, in which we saw an increase of all financial indicators and continued to make substantial investments in infrastructure and company transformation.
We have fully reversed the falling trends and laid the foundations for growth and, by acquiring a majority stake in Crnogorski Telekom, we have expanded onto the regional market at the beginning of 2017. We will continue monitoring opportunities for regional expansion.
We will keep our focus on the strategy of growth of Hrvatski Telekom as a leader on the national and regional telecommunications and digital services market.”