Telekom Austria Group reported revenues of EUR 1.063 billion for the second quarter, down 4.2 percent year-on-year. This includes a negative effect from hyperinflation accounting and foreign exchange of EUR 55.3 million, mainly resulting from the Belarus operations. The decline in revenues also came in Austria due to intensified competition, and revenues in Bulgaria decreased due to the challenging economic environment and lower pricing. Revenue growth came in all other segments, such as Croatia where the fixed-line businesses drove growth, and in Belarus, where an ongoing strong operational performance outweighed the negative effect of hyperinflation accounting and foreign exchange translation. Excluding the impact of hyperinflation accounting and foreign currency translation, group revenues increased by 0.8 percent to EUR 1.119 billion.
Telekom Austria’s EBITDA comparable, which does not include effects from restructuring and impairment tests, declined 4.2 percent to EUR 364.8 million. This includes a negative effect of EUR 23.7 million related to hyperinflation accounting and foreign exchange. The operating income grew 16.6 percent to EUR 99.1 million due to cost savings programs in Austria, Bulgaria, Croatia and the Additional markets segment. The net profit improved from EUR 20 million in the second quarter of 2011 to EUR 34 million this year.
Due to lower MTA and roaming tariffs and economic headwinds anticipated to remain strong in the group’s markets in the CEE region, Telekom Austria lowered the group guidance for the full year. The group now expects revenues of EUR 4.2 billion, instead of the EUR 4.4 billion forecast in May. The EBITDA guidance is cut from EUR 1.5 billion to EUR 1.4-1.45 billion, and the capex range was lowered, from EUR 750 million to EUR 700-750 million. Lower capex and cost savings should ensure operating cash flow of EUR 700-750 million, versus an earlier outlook of EUR 750 million. The group stills intends to pay a dividend per share of EUR 0.38 for this year.
