Telekom Romania Communications and Telekom Romania Mobile Communications announced key performance indicators for the third quarter of 2016, ended on September 30, 2016, as reported by OTE Group on Thursday.
“The quarter was marked by positive results generated by the new revenue stream segments that are showing steady growth, such as TV and wholesale, leading to higher total revenues for both fixed and mobile. The slight decrease of mobile users of Telekom Romania Mobile Communications is offset by the increasing number of MagentaONE customers, a trend showing the interest for integrated fixed-mobile services. Mobile business customers increased as a result of the fixed-mobile synergies in motion. We focus on continuously improving customer experience, offering extended 4G and fibre optics networks, while extending our ICT portfolio for businesses. In this respect, within the last three months, we increased FTTx coverage by approximately 16% to 2 million households, providing them with state-of-the-art technology”, said Anastasios Tzoulas, Chief Financial Officer, Telekom Romania operations.
Communications
The Q3 2016 financial results reported by Telekom Romania Communications were marked by an increase in revenues and EBITDA, as well as the continuous growth of fixed-mobile convergent offers, TV and wholesale. Revenues reached EUR 149.1 M, 3.9% higher than in Q3 2015, while for the first nine months of the year they amounted to EUR 435.7 M, lower by 1.6% versus the same period of 2015.
Pro forma EBITDA (Earnings before Interest, Taxes, Depreciation and Amortization, excluding the impact of restructuring plans) for Q3 2016 was EUR 29.5 M, versus EUR 23.9 M in Q3 2015, up by 23.4% mainly due to tight indirect cost control, wholesale and one-off deals (RONET), while for the nine-month period was lower by 21.3%, amounting to EUR 65.2 M versus EUR 82.8 M yoy. Operating expenses, excluding depreciation, amortization, charges related to voluntary retirement programs and restructuring costs, remained at the same level as in Q3’15, despite of higher interconnection costs.
Telekom Romania Communications reached 338,232 customers for MagentaONE convergent offers, up by 92% compared to Q3 2015.
The 2.1% yoy increase in the TV services customer base is in line with the trend of previous quarters. The number of TV subscribers reached 1.46 million at the end of September 2016, while the corresponding revenues increased by 5% compared to Q3 2015. The TV technology with the highest increase in Telekom’s TV portfolio was IPTV. Regarding FTTx, the fibre coverage increased to almost 2 million households, up from 1.7 million at the end of Q2 2016. Customers opting for this technology benefit from broadband speeds of up to 1 Gbps and seamless interactive television (IPTV) services.
Broadband subscribers (both fixed and mobile) remained relatively stable in Q3 2016 vs. Q2 2016, to 1.188 million, from 1.194 million. Revenues from broadband for Q3 2016 were slightly lower (-1%) compared to the same period of 2015. Voice users (fixed and mobile) reached 2.165 million. Despite the revenues performance of the mobile segment, the fixed voice revenues registered a 13% decline in Q3 2016.
Telekom Romania Communications wholesale revenues increased by 18.6% in Q3 2016, to EUR 31.3 M compared to the same period of 2015, while for the first nine months were up by 8.9%, to EUR 85.4 M.
Fixed and mobile RGUs remained at the same level in Q3 2016 compared to the same period last year, reaching 4.814 million.
Mobile Communications
Telekom Romania Mobile Communications registered total revenues of EUR 112.1 M in Q3 2016, up by 2.7% compared to the same period last year, while service revenues decreased by 3.5%, to EUR 77.3 M in Q3 2016.
In Q3 2016, compared to the same period last year, Telekom Romania Mobile’s total customer base decreased by 3.4%, to 5.5 million, out of which 29% are post-paid customers. The total number of business customers grew by 2.4% compared to Q3 2015, reflecting the company’s targeted offers for professional users and synergies created following its rebranding, together with Telekom Romania Communications, under the Telekom brand.
Blended ARPU increased by 0.3% in Q3’16 compared to Q3’15.
Lower margin on prepaid services due to intense market competition, together with costs associated with the Company’s expansion of its business customer base, led to a 2.0% drop in EBITDA compared to Q3 2015.
Alongside the fixed-line operations, Telekom Romania Mobile is taking steps to improve its performance, including enhanced 4G capabilities, refocusing of its sales efforts and cost improvements.
On the B2C post-paid segment, Telekom Romania Mobile Communications continued to be the operator with the simplest, most straightforward product portfolio positioned at different price points between 8.95 and 49.95 euro and addressing various communication needs.
In the prepaid residential segment, data users adopted very fast the GigaWeekend offer launched in 2015, with a bonus of 1 GB of data traffic that can be requested by customers with active options every weekend. The GigaWeekend bonus enjoyed a 72% repurchase rate and, as a result, built on these strengths, Telekom Romania Mobile launched the GigaWeek summer prepaid offer – 1GB data traffic bonus per week.