KPN's Q1 Profits Plunge by 98 Percent
Published on: 25th Apr 2014
By: Ian Mansfield
Netherlands based KPN just about managed to avoid dipping into a quarterly loss as it reported a further decline in revenues.
The company posted an 8.2 percent fall in revenues to EUR1.996 (US$2.76 billion), while net profit plunged by 98% to just EUR 3 million (US$4.15 million).
KPN said that the fall in revenue was due to the continued competitive environment and price pressure in all mobile markets, and the ongoing decline of the Business market size.
Adjusted EBITDA decreased by 21% y-on-y in Q1 2014 as a result of declining revenues and phasing out of handset lease at the KPN and Hi brands. Adjusted EBITDA excluding phasing out of handset lease in Q1 2014 was down 15% y-on-y
"Our financial results in the first quarter were impacted by the competitive environment in our mobile markets, leading to continued decline of ARPUs, and pressure on the total market size in Business. Corporate customers remain cost constrained, leading to continued rationalization and optimization." said the CEO, Eelco Blok.
The company is still seeking regulatory approval for the sale of its E-Plus network in Germany, which will significantly help to pay down its group debt.