BUCHAREST (Romania), May 12 (SeeNews) - Telekom Romania said on Wednesday that its adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) in the first quarter rose 2.1% year-on-year to 34.5 million euro ($41.9 million), despite lower revenues.
An important driver of the company’s sustained EBITDA and cash flow growth is the successful and comprehensive cost transformation programme, which was initiated in the second half of 2018 and continues to generate significant improvements in its cost base, Telekom Romania said in a press release.
Compared to the same period a year ago, the company reduced its indirect costs by 9% as a result of structural improvements.
Telekom Romania's total revenues decreased 11.4% year-on-year to 210 million euro in the three months through March.
"As part of our strategic transformation over the past years, we have worked to create a sound financial base for our company and to make ourselves more resilient in the phase of external market pressures," Telekom Romania chief financial officer Nicolas Mahler said. "Our Q1 results show that this effort was the right strategic direction and is paying off, as we managed to further grow our EBITDA year over year, despite a difficult market environment after a year of the pandemic and even compensating seasonal one-off effects from the past."
Revenues from the traditional fixed voice business declined to 12.1 million euro in the first three months of 2021, while remaining on a
similar level to the previous quarter, thus further slowing down the decline trends. Fixed broadband revenues totaled 16.9 million euro, showing a decline compared to pre-pandemic levels, but registering a 4% growth compared to the last quarter of 2020. The number of TV subscribers declined year over year to 1.1 million.
On the mobile business, the number of postpaid subscribers further increased, reaching 1.66 million, up 8% compared to the same period in the previous year, marking the fourth consecutive quarter of customer growth.
Mobile revenues declined by 3% year over year to 93.7 million euro, affected by a reduction in interconnection traffic, as well as the restrictions imposed, as a direct result of the Covid-19 pandemic. The total mobile customers’ base was 3.55 million at the end of March 2021.
Greek telecom group OTE, in which Deutsche Telekom is the largest shareholder, is present in Romania since 2014. OTE's units in Romania - fixed-line operator RomTelecom and mobile operator Cosmote - were rebranded as Telekom Communications Romania and Telekom Mobile Romania, respectively, in September 2014.
Telekom Communications Romania is majority owned by OTE with 54%, while Romania's communications ministry holds 45.99%. Telekom Mobile Romania is owned by OTE Group member Cosmote Mobile Communications with 69.9%, Telekom Romania Communications with 30% and other minority shareholders.
In November, OTE announced that it has entered into an agreement to sell its 54% stake in Telekom Romania Communications for 268 million euro to Orange Romania, a unit of France Telecom's Internet and mobile arm Orange.
The transaction is subject to regulatory approvals and other conditions and is expected to be completed within the second half of 2021.
($ = 0.8241 euro)
Romtelecom SA is among the biggest companies in SEE, for more reference take a look at Top 100 companies