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Magyar Telekom grows FY sales 0.8%, targets stable 2008 (Hungari)

  • February 15th, 2008
  • 2:50 pm

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.

   

Slovenia gets three binding bids for Telekom (Slovenia)

  • January 7th, 2008
  • 3:00 pm

The Slovenian government has received three binding bids in the second round of the sale of 49.13 percent of Telekom Slovenije, according to local daily Dnevnik. The three bids came from Iceland’s Skipti, Magyar Telekom and a consortium of Bain Capital and Axos Capital. Croatia’s T-HT withdrew from the tender, and Australia’s Macquarie Bank failed to submit a bid. The Privatisation Commission decided that bidders have until 15 January to submit completed bids.

   

Magyar Telekom, Pannon sign GSM licence extensions (Hungary)

  • November 27th, 2007
  • 2:51 pm

Hungary’s Minister of Economy & Transport Janos Koka has signed contracts with Magyar Telekom and Pannon GSM to extend their GSM 900 MHz frequency usage rights by 7.5 years to 04 May 2016. Each operator has agreed to pay a one-time licence fee of HUF 10 billion and pledged to invest HUF 20 billion in mobile broadband over the next two years. The current licence agreements expire on 04 November 2008. The operators have agreed to expand their mobile broadband networks in Hungary’s disadvantaged regions in 2008 and 2009 at rates greater than foreseen originally in their business plans. As a result, mobile broadband will be available on 90 percent of Hungary’s total area, i.e. at all settlements with populations higher than 1,000, representing 98 percent of the total population. The development projects will be carried out in the regions of South Transdanubia, North Hungary, North Hungarian Great Plain, South Hungarian Great Plain, Central Transdanubia and West Transdanubia.

   

MT, unions agree on 15% cut in workforce (Hungary)

  • October 3rd, 2007
  • 2:54 pm

Hungary’s largest telecoms company Magyar Telekom (MT) has agreed terms with unions representing its workers to cut its workforce by 15% by the end of 2008, resulting in a 5% saving in employees’ costs. The move is expected to cost HUF24 billion (USD135 million) in severance payments in fiscal year 2007; payments in 1H 2007 for redundancies amounted to HUF7.3 billion. However, the decision will result in savings of HUF13 billion at a group level, going forward. Deutsche Telekom-controlled MT and the unions also agreed a pay rise of 5.5% effective from March 2008.

   

 

 

 

Magyar Telekom reaches agreement with unions over job cuts (Hungary)

  • October 3rd, 2007
  • 12:53 pm

Hungary’s Magyar Telekom has reached an agreement with trade unions on its job reduction plans for 2008. The decision regarding group-level workforce reduction is expected to result in additional HUF 24 billion severance-related expenses in 2007, to be accounted in the fourth quarter. Workforce reduction-related expenses were HUF 7.3 billion in H1 2007. The already implemented headcount reductions and the new headcount reduction-related agreements are expected to result in an annual saving of HUF13 billion in group-level employee related expenses. The headcount reduction measures are expected to decrease the group-level headcount by 15 percent by end-2008 compared to end-June 2007.

   

HTCC buys Invitel for EUR 470 million

  • January 10th, 2007
  • 6:34 am

Telecompaper writes…Hungarian Telephone and Cable Corp (HTCC) has agreed to acquire Hungarian fixed-line rival Invitel for EUR 470 million. The combined group commands already a 20 percent market share, making it the number-two player in Hungary after incumbent Magyar Telekom, owned by Deutsche Telekom. For the year to September 2006, they had joint sales of EUR 346 million and EBITDA of EUR 119 million. The companies expect to realise EUR 14 million in operational cost savings as well as further reductions in capex from the benefits of integrating networks.

The purchase price includes Invitel’s debt and is equal to 6.1 times Invitel’s EBITDA for the 12 months to September 2006. HTCC will issue debt to finance the deal, as well as 1.1 million of its shares, equal to a 6.2 percent stake, to Invitel management. Pending regulatory approval, the deal is expected to close in the first half of 2007. Invitel’s CEO Martin Lea will head the combined group, with Invitel’s Robert Bowker serving as CFO. HTCC’s CEO Torben V Holm will step down after assisting with the early phase of integration. HTCC is 63 percent owned by Denmark’s TDC, with the remainder listed on the stock market. Invitel is controlled by the private equity groups Mid Europa Partners and GMT Communications.