VIENNA, November 12 /PRNewswire/ --
- Further improvement of Fixed Net operating trends with only a 1.3%
access lines loss compared to end of September 2008
- Mobile Communication base grows by 8.6% year-on-year to 18.5 million
customers despite a difficult economic environment
- Revenues decline of 6.3% to EUR 3,620.5 million primarily driven by
lower Fixed Net and roaming revenues as well as FX currency translation
- Strict cost management reduces operating expenses by 4.9% and limits
EBITDA decline to EUR 1,394.6 million
- Net income reflects impairment charges of EUR 352.0 million related to
investments in Belarus and in the Republic of Serbia
- 2009 outlook for operating free cash flow of EUR 1.1 billion
reiterated, Capex cuts compensating lower EBITDA due to FX, roaming,
declining prices and impact from weaker economies
- Management expects difficult market environment to prevail also in 2010
- Dividend per share floor of 75 cents per share reiterated for 2009-2012
% 1-9M 1-9M %
in EUR million 3Q 09 3Q 08 change 09 08 change
Revenues 1,231.7 1,328.0 -7.3% 3,620.5 3,863.8 -6.3%
EBITDA 489.8 538.2 -9.0% 1,394.6 1,492.4 -6.6%
Operating income -126.4 260.0 n.a 223.9 636.4 -64.8%
Net income -136.3 162.9 n.a 31.3 388.9 -92.0%
Earnings per share (in
EUR) -0.31 0.37 n.a 0.07 0.88 -91.9%
Free cash flow per share
(in EUR) 0.48 0.56 -14.5% 1.23 1.29 -5.0%
Capital expenditures 154.5 184.0 -16.0% 419.8 534.3 -21.4%
Sept. Dec. %
in EUR million 30, 09 31, 08 change
Net debt 3,781.5 3,993.3 -5.3%
Net debt/EBITDA (12 months) excluding
restructuring program 2.1x 2.1x
All financial figures are based on IFRS; if not stated otherwise, all comparisons are given year-on-year. EBITDA is defined as net income excluding interest, income tax expense, depreciation and amortization, impairment charges, equity in earnings of affiliates, income/loss from investments and foreign exchange differences. This equals operating income before depreciation, amortization and impairment charges.
Group Review
Vienna, November 12, 2009 - Telekom Austria Group (VSE: TKA, OTC US: TKAGY) today announced its results for the first nine months 2009 and the third quarter ending September 30, 2009.
Hannes Ametsreiter, CEO Telekom Austria Group, said: "The results for the first nine months 2009 reflect weaker economies in foreign markets, negative currency effects and further disrupting roaming regulation. Strict cost management partly compensated for a decrease in revenues and a reduction of capital expenditures mitigated the impact on operating free cash flow. Operating trends of the Fixed Net segment further improved for the seventh consecutive quarter thanks to a continuing strong uptake of product bundles. Against a challenging background, the Mobile Communication segment proved once again successful in growing its subscriber base to 18.5 million customers. We reiterate our full-year 2009 outlook for the operating free cash flow of about EUR 1.1 billion on an actual currency basis, with a reduction of capital expenditures compensating for the shortfall of EBITDA. We also further confirm a minimum dividend floor of EUR 0.75 per share for the years 2009 - 2012."
Summary
Year-to-date comparison:
During the first nine months of 2009 revenues decreased by 6.3% to EUR 3,620.5 million primarily driven by lower Fixed Net revenues as a result of a decline in voice volumes. The sale of the Fixed Net subsidiaries in the Czech Republic, in Slovakia and in Poland also contributed EUR 29.8 million to this decrease. Strict cost management reduced operating expenses by 4.9% and limited the decline in EBITDA to 6.6% or EUR 1,394.6 million due to lower contributions from both business segments.
A decline in operating income of EUR 412.5 million to EUR 223.9 million and the drop in net income of EUR 357.6 million to EUR 31.3 million reflect primarily impairment charges totalling EUR 352.0 million resulting from the goodwill from the acquisition of Velcom in Belarus and for the license of Vip mobile in the Republic of Serbia.
Operating income before impairments fell by 9.5% to EUR 575.9 million as a higher contribution from the Fixed Net segment partly offset a lower operating income from the Mobile Communication segment. Excluding the impairments net income was EUR 290.3 million during the first nine months of 2009.
Capital expenditures decreased by 21.4% to EUR 419.8 million mainly driven by a reduction of capital expenditures in the Mobile Communication segment. Free cash flow declined by 5.0% in line with the development of free cash flow per share which decreased to EUR 1.23. Deleveraging continued with net debt decreasing by 5.3% to EUR 3,781.5 million at the end of September 2009 compared to year-end 2008. Excluding the impact of the provision for the restructuring program in 4Q 2008, net debt to EBITDA (last 12 months) was 2.1x.
Quarterly comparison:
In 3Q 09 revenues declined by 7.3% to EUR 1,231.7 million as a result of lower contributions from both segments. Reductions in operating expenses by 3.3% as well as a one-off refund received in the Fixed Net in the amount of EUR 10.2 million mitigated the impact of lower revenues and resulted in an EBITDA of EUR 489.8 million in 3Q 09 compared to EUR 538.2 million in 3Q 08.
Operating income in 3Q 09 fell by EUR 386.4 million to an operating loss of EUR 126.4 million and net income declined by EUR 299.2 million to a net loss of EUR 136.3 million compared to the same period of the previous year. These decreases are due to impairment charges of EUR 352.0 million related to the goodwill for the acquisition in Velcom in Belarus and the license of Vip mobile in the Republic of Serbia. Excluding the impairment charges operating income declined by 13.2% to EUR 225.6 million due to a lower contribution from the Mobile Communication segment, the operating income in the Fixed Net segment grew by 11.2% as a result of lower depreciation and amortization charges. Excluding impairment charges net income was EUR 122.7 million in 3Q 09 compared to EUR 162.9 million in 3Q 08.
As a result of a restrictive investment policy capital expenditures decreased by 16.0% from EUR 184.0 million to EUR 154.5 million as lower capital expenditures in the Mobile Communication segment partly offsetting an increase in the Fixed Net. The reduction of capital expenditures partly compensated for a lower result from operations resulting in a decline in free cash flow by 14.4% to EUR 213.5 million. Free cash flow per share was EUR 0.48 in 3Q 09.
Market Environment
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