Telekom Austria Group Drops into Full Year Loss on Subsidiary Write-Downs
Published on: 23rd Feb 2012
Note -- this news article is more than a year old.
By: Ian Mansfield
Europe's Telekom Austria Group has reported that its full year revenues declined by 4.2% to EUR4.46 billion (USD5.6 billion). Lower revenues in the Austrian Bulgarian Belorussian and Croatian segments could not be fully compensated for by the favorably strong growth in the "Additional Markets" segment (Slovenia Republic of Serbia Republic of Macedonia Liechtenstein).
However, the company also plunged into a net loss of EUR252.8 million (USD334.6 million) compared to a profit of EUR 195.2 million in 2010. The loss was in part due to an impairment charge of EUR 279 million (USD369 million) related to what the company called "hyperinflation" affecting its Belarusian subsidiary.
In Belarus, the local currency was devalued by 63% in the year under review, with inflation rising by 108%.
"Our operating performance continues to be successful: for instance, the sustainable increase in fixed access lines in Austria, which is unparalleled throughout Western Europe , as well as the considerable improvement of results in Slovenia, the Republic of Serbia and the Republic of Macedonia, are key indicators of this success. Growth in the fixed line business - also in our foreign markets - and ever-rising mobile subscriber numbers demonstrate that we are on the right track with our convergence strategy in our highly competitive operating markets," said Hannes Ametsreiter, CEO Telekom Austria Group, commenting upon the operating situation of the Group.
The Telekom Austria Group's net debt increased by 2.3% to EUR 3.38 billion in 2011. This includes acquisitions costs of EUR 173.9 million in Bulgaria and Croatia.