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Q2 profits down 16.5% at Telekom Austria

Hannes Ametsreiter called the spectrum price a "bitter pill"

Austrian incumbent carrier Telekom Austria Group has reported that second quarter net profit for 2010 dropped by more than 16 per cent year on year to €68.7m. The firm attributed the decline to intense competition against a backdrop of regulatory and macroeconomic pressure. In particular, said group CEO Hannes Ametsreiter, a drop in fixed network voice minutes and a reduction in mobile termination rates have hit the firm’s income.

The carrier has a portfolio across Central and Eastern Europe, with mobile operations in Bulgaria, Belarus, Croatia, Slovenia, Serbia and the Republic of Macedonia.

Revenue for the quarter was down by 1.9 per cent to €1.17bn, but Ametsreiter said there were reasons for a degree of optimism. “In the Fixed Net business we almost stabilised the number of fixed lines at 2.3 million, while the customer base in the Mobile Communication segment mitigated the impact of lower revenues on Group EBITDA.”

The carrier said that it had refined its outlook for full year 2010, with group revenues now projected to reach ¢4.7bn, giving an EBITDA of €1.6bn. “We have claimed to build the most innovative and efficient telecom operator in CEE and we [stand by] this claim, despite a demanding economic environment,” said Ametsreiter.

All of the firm’s mobile operations enjoyed year on year customer growth, with the domestic operation leading the way. Mobilkom Austria grew its subscriber base by 7.3 per cent to almost five million at the end of June this year. The carrier attributed the growth to success in a multi-tier strategy, offering premium and no-frills brands. The firm is the first placed mobile carrier in its home market, with 42.1 per cent market share, down from 42.3 per cent at the end of June 2009.


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