Dutch operator KPN reiterated its guidance for 2010 and 2011 as first-quarter revenues fell in line with market concensus, according to a Reuters poll of analysts. Revenues for the quarter slid 3.5 percent to EUR 3.28 billion from 3.39 billion the year before, pulled down by lower Dutch sales, a negative effect from disposals and cuts to mobile termination rates. KPN CEO Ad Scheepbouwer said the company continued to feel pressure from the general economic situation and regulatory measures, offset by a continued focus on customer value and cost-cutting measures. The CEO noted that the service revenue trend in Germany was improving, with a continued strong EBITDA margin.
Group EBITDA EBITDA lifted 7.2 percent to EUR 1.32 billion from 1.23 billion, and the EBITDA margin went higher to 40.4 percent form 36.3 percent. EBIT rose 25 percent to EUR 793 million, and the net profit went up 42 percent to EUR 449 million. Net debt at the end of the quarter rose slightly to EUR 11.4 billion from 11.1 billion at the end of the previous quarter, mainly due to a net tax prepayment. Cost-cutting measures were continuing, with the number of FTEs reduced by 945 to 32,203 in the quarter.
In the Netherlands, EBITDA rose 8.7 percent to EUR 954 million, while revenues fell 5.0 percent to EUR 2.29 billion, impacted by the decline in traditional business, regulatory pressure and the economic downturn in the business market. Mobile service revenues went down 6.7 percent, including a 5 percent fall due to regulatory measures and the impact of migrating some Debitel customers to the Business segment and other operators. KPN’s mobile customer base declined by 444,000 in Q1. Data revenues meanwhile grew about 50 percent, excluding SMS/MMS. ARPU was stable at EUR 23.
Consumer NL revenues sank 6 percent to EUR 969 million, as EBITDA strengthened 7 percent to EUR 261 million. Business revenues were flat at EUR 634 million, while EBITDA rose 14 percent to EUR 223 million. Wholesale & Operations revenues slid 4.2 percent to EUR 704 million, and EBITDA fell 4.0 percent to EUR 427 million. At iBasis, revenues were down 3 percent to EUR 193 million, with EBITDA up 14 percent to EUR 8 million. Revenues at Getronics dropped 13 percent to EUR 474 million, with EBITDA at EUR 29 million. Scheepbouwer said iBasis witnessed the first signs of a turnaround due to new management, while the economic situation continued to impact Getronics.
At Mobile International, revenues lifted 1.8 percent to EUR 999 million from 981 million, and EBITDA rose 4.8 percent to EUR 384 million. In Germany EBITDA shed 0.3 percent to EUR 321 million, and sales slid 0.8 percent to EUR 768 million. E-Plus gained 303,000 net adds due, mainly to the growth in Base and wholesale brands, while postpaid showed a small decline. E-Plus is confident it can achieve service revenue growth from the second quarter. The division will this year step up investments on mobile data growth. In the first half of the year, investments will focus on HSPA upgrades within the existing UMTS network. In the second half, the division will put money in speeding up the roll-out of network upgrades.
In Belgium, revenues rose 5.8 percent , with mobile service revenues at Base up 9.7 percent, and no MTA impact. KPN estimates that the service revenue market share increased by more than 1 percent to 18 percent. EBITDA was up 8.1 percent.
