Telekom Austria’s net profit more than doubled in the first quarter thanks to intensive cost cutting and growth at its domestic broadband and TV divisions.
In the three months to 31 March, Telekom Austria’s net profit soared 127.5% on-year to €92.7 million. Operating expenses fell to €661.3 million from €672.2 million. In Austria, the incumbent’s fixed broadband and TV customer bases increased 5.2% and 6.6% respectively.
"We think twice about every cent we spend and we are streamlining the Telekom Austria group to bring it back to its growth path. These joint efforts are clearly reflected in the strong net profit of €92.7 million," said Hannes Ametsreiter, CEO of Telekom Austria, in a statement.
"At the same time, we continue to offer our customers the best quality in terms of infrastructure, products and services. By investing in the broadband rollout, we are creating the basis to be able to supply even more customers and to offer even better products going forward," he said.
Group revenue fell 2% to €956 million, which Telekom Austria attributed primarily to currency fluctuations driven by the Belarusian rouble, and the impact of EU regulation on roaming and interconnection rates.
EBITDA increased to €338.5 million from €319.9 million, driven mainly by strong operating performances in Austria and Belarus.
In the latter, Telekom Austria took a number of measures – including price rises, the cancellation of handset sales on credit, and the revision of its capex plan, among others – to counter the devaluation of the rouble. It drove EBITDA up 4.4% on-year to €41.7 million.
EBITDA in Austria grew 6.3% to €207.1 million driven by a 3.3% fall in operating expenses, and slowing revenue decline thanks to a reduction in subsidies and higher postpaid mobile revenue.
In terms of customers, Telekom Austria group ended Q1 with 20 million mobile customers and 2.8 million fixed-line customers spread across its eight operating markets.
The company reiterated its full-year 2015 outlook. It expects revenue to grow 2% and plans for capex of €700 million-€750 million.
