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KPN Profits Drop by a Quarter on Slightly Lower Revenues
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Netherlands based KPN has reported that its second-quarter revenues fell by 3 percent to EUR 3.19 billion, while net profits fell by a quarter to EUR315 million (US$382 million).
KPN's CEO, Eelco Blok commented: "In The Netherlands, despite the ongoing pressure on results from difficult market conditions, we are driving forward the accelerated investment strategy to strengthen our market positions across segments."
He added that "In Germany and Belgium we maintained growth in service revenues and customers including postpaid, while continuing to extend our high speed networks and launch attractive new propositions to drive future growth."
The company also announced plans to cut future dividend payments to shareholders in order to preserve its cash resources. The company had predicted dividend payments of EUR0.90 per share and this will now be cut to EUR0.35 per share.
The justification given that the company needs to preserve cash and pay down its EUR11.8 billion of debt. The move could also be a spoiler against America Movil which has just bought a hostile 27% stake in the company, and was presumably expecting dividend payments based on previous forecasts.
The company said that its EBITDA, Capex and free cash flow guidance for full year 2012 are confirmed.
Tags: [kpn] [Netherlands]
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