Magyar Telekom grows FY sales 0.8%, targets stable 2008 (Hungari)Magyar Telekom revenues grew 0.8 percent last year to HUF 676.7 billion. EBITDA for 2007 fell 5.7 percent to HUF 243.9 billion, with an EBITDA margin of 36 percent. EBITDA excluding investigation-related costs (HUF 5.7 billion) as well as severance payments and accruals was HUF 277.1 billion, with a margin of 40.9 percent.
Net income fell by 20.3 percent, from HUF 75.5 billion to HUF 60.2 billion, hit by costs for the headcount reduction programme, higher financial expenses and the introduction of the solidarity tax as of September 2006. Net cash generated from operating activities grew from HUF 190.3 billion to HUF 231.3 billion, mainly due to the lower working capital requirements and reduced tax payment thanks to the utilisation of tax benefits. For 2008, Magyar Telekom targets stable revenues and a slight decline in underlying EBITDA compared to 2007. The main factors impacting EBITDA are the increased competition in the mobile market, the difficult Hungarian macroeconomic environment and regulatory decisions. The operator targets a capex to sales ratio of around 15 percent.
At the Hungarian fixed-line activities, fourth-quarter revenues fell 2.7 percent to HUF 61.5 billion, while EBITDA fell 48 percent to HUF 12.0 billion due to the staff reduction costs. The adjusted EBIDTA margin was at 38.8 percent. The decline was due to falling voice revenues and increased competition primarily from mobile and cable operators, leading to a reduction in traffic and average tariff levels. Internet revenues were up 11.5 percent to HUF 13.5 billion as the number of broadband connections rose to 717,000 at end-2007. The total number of fixed lines fell 6.0 percent from end-2006.
T-Mobile Hungary showed a revenue decline of 0.5 percent to HUF 73.2 billion in the fourth quarter, as the growth in the customer base and expansion of value-added service revenues were offset by a decline in equipment sales and wholesale voice revenues. ARPU showed a 5.4 percent decrease due to the declining tariff levels and the cut in mobile termination rates in February 2007. Average acquisition cost per new customer increased by 5.1 percent, reflecting the higher subsidies for postpaid customers and 3G/HSDPA enabled devices. EBITDA was HUF 29.3 billion, giving a margin fo 40.0 percent.
