Worsening economic environment, increased competitive pressure and regulatory environment result in 7.1% revenue decline, but margins remain stable and innovation in products and services continues
30.10.2012
T-Hrvatski Telekom (Reuters: THTC.L, HT.ZA; Bloomberg: THTC LI, HTRA CZ), Croatia’s leading telecommunications provider, announces unaudited results for the nine months to 30 September 2012.
Group Highlights
- Revenue down 7.1% to HRK 5,660 million or EUR 753 million (Jan-Sep 2011: HRK 6,092 million, EUR 822 million)
- Underlying revenue down 6.8%,
- excludes positive one-off impact of change in useful life of customer relationship recognized in Q3 2011
- excludes impact of 6% mobile fee applicable to entire period Jan-Sep 2011 and Jan 26 to July 9 2012
- Non voice revenues show continued growth
- Fixed broadband ARPA up 3.9% to HRK 125
- Mobile data subscribers up 25.1% to 819,978
- Smartphone sales at 51.0 % of total handsets sold
- EBITDA falls 6.7% to HRK 2,611 million (EUR 347 million), margin at 46.1% (Jan-Sep 2011: HRK 2,799 million or EUR 378 million, 46.0%)
- Continued impact from cost controls
- Merchandise and telecommunication costs, along with other categories, lower against Jan-Sep 2011
- Net profit down 6.4% at HRK 1,388 million (EUR 185 million)
- Operating cash flow up 0.9% to HRK 1,910 million (EUR 254 million)
- Capex down 8.3% to HRK 581 million
- T-HT granted the preferred block of 811-821/852-862 MHz in public submission process for wireless frequency licence on 790MHz-862 MHz band
- 6% mobile fee abolished, effective 9 July 2012
Residential Segment
- T-HT maintained its leading position in all three markets (mobile, fixed line and IP)
- Mobile subscribers down 3.2% (up 3.8% on Q2 2012)
- 523,669 broadband retail access lines, down 2.7% (down 0.8% on Q2 2012), and 329,290 TV customers, up 3.6% (up 0.8% on Q2 2012)
- Revenue down 7.3%, due mainly to lower voice revenue in mobile and fixed
- Contribution to EBITDA of HRK 2,075 million, down 8.4%
- LTE network operational in March; continued promotions of 4G mobile internet tariffs in Q3
Business Segment
- Substantial customer base across all segments and products
- Mobile subscribers up 4.8% (down 1.4% on Q2 2012)
- 104,935 broadband retail access lines, down 2.6% (down 1.0% on Q2 2012) and 19,992 TV customers, up 5.7% (0.8% to Q2 2012)
- Revenue down 6.9%, due largely to lower voice revenues in mobile and fixed
- Contribution to EBITDA of HRK 1,618 million, down 3.7%
- Further development of Cloud services
Ivica Mudrinić, President of the Management Board (CEO), said: “The economic environment in Croatia remains sluggish and is experiencing a further contraction in 2012 GDP, increasing unemployment and higher inflation. Rising energy and food prices continue to put pressure on disposable income, whilst the corporate sector continues to be hit by insolvencies. At the same time, competition remains intense and the regulatory regime remains tight. Against this backdrop, T-HT reported lower revenue and EBITDA but was nevertheless able to implement cost discipline and maintain margins. The combined impact of the factors outlined above has led the Group to somewhat decrease its financial expectations for the full year.Along with delivering a solid financial performance, we continue to implement a strategic vision that will position the Group for future growth. We have maintained our leading market position through a continued focus on innovative products to improve the services we provide our customers. These include new Cloud-based services and Croatia’s first NFC mobile payments pilot. We are also investing in leading edge technologies such as next-generation 4G networks in mobile and the migration of our fixed-line offering on the IP network.”