Deep recession, regulatory tightening and special tax continue to impact business; revenue fall of 3.6%, limited by Combis contribution and strong IP revenue growth; solid margins on effective cost management
14.2.2012
T-Hrvatski Telekom (Reuters: THTC.L, HT.ZA; Bloomberg: THTC LI, HTRA CZ), Croatia’s leading telecommunications provider, announces audited results for the year ended 31 December 2011.
Group Highlights
- Revenues down 3.6% to HRK 8,067 million or EUR 1,086 million (2010: HRK 8,372 million, EUR 1,148 million)
- Combis contributes HRK 413 million or EUR 56 million (2010: HRK 232 million, EUR 32 million. Consolidated from May 2010)
- Underlying revenues down 6.9%, excluding both Combis contribution and revenue recognition after change in useful life of customer relationship as outlined on page 9
- IP and ICT revenues show continued growth
- Number of cost control initiatives across the Group continue to protect margins
- EBITDA slightly below 2010 level at HRK 3,619 million (EUR 487 million) and 44.9% margin (2010: HRK 3,662 million or EUR 502 million, 43.7%)
- EBITDA before exceptional items of HRK 3,782 million (EUR 509 million) at 46.9% margin (2010: HRK 3,694 million or EUR 507 million, 44.1%)
- Net profit 1.1% down at HRK 1,811 million (EUR 244 million)
- Operating cash flow down 8.5% to HRK 2,988 million (EUR 402 million)
- Proposed dividend of HRK 22.14 per share; payout ratio equals 100% (2010: HRK 22.76 per share)
- Privatization of PTK terminated by the Government of Kosovo
- Croatian Parliament adopted recently elected Government’s proposal to reinstate 6% fee on revenues generated by mobile services
Residential Segment
- T-HT maintained its leading position in all three markets (mobile, fixed line and IP)
- Mobile subscribers down 1.9% (down 3.3% on Q3 2011)
- 539,172 ADSL mainlines, up 2.9% (up 0.1% to Q3 2011), and 321,256 TV customers, up 12.3% (up 1.1% on Q3 2011)
- Revenues down 4.4%, due largely to lower voice revenues in mobile and fixed
- Contribution to EBITDA of HRK 3,025 million, up 1.0%
Business Segment
- Substantial customer base across all segments and products
- Mobile subscribers up 4.4% (flat on Q3 2011)
- 111,541 ADSL mainlines, up 6.0% (up 2.0% on Q3 2011) and 19,487 TV customers, up 12.4% (up 3.0% on Q3 2011)
- Revenues down 2.7%, due largely to lower voice revenues in mobile and fixed
- IP and ICT revenues showing further growth with new ICT services launched
- Contribution to EBITDA of HRK 2,287 million, down 5.8%
Ivica Mudrinić, President of the Management Board and CEO, said:
“T-HT has again delivered a solid performance in the face of an increasingly challenging economic environment. Throughout 2011, Croatia saw a continued rise in unemployment, with consumption falling further while business payment arrears continued to rise. Competition within the telecoms sector also intensified further. At the same time, a raft of new domestic regulatory measures and progress toward regulatory alignment with the EU put further pressure on the Group. As a result, T-HT Group reported a fall in revenue for the year, offset to a degree by one-off items. However, the Group continued to successfully implement cost reduction measures and remains robust in severe market conditions.
Despite the harsh economy, T-HT continued to expand its activities across all areas of the business, with the development and launch of innovative products such as cloud-based ICT services. As a result, the Group maintains its leading position in the Croatian telecoms markets.
The regulatory regime still remains a deterrent to communications infrastructure investment – a key element to economic growth. Whilst there is very little expectation of improvement in the current economic situation, the Group will however innovate and develop its business further throughout 2012.”