Cesky Telecom reports solid results before impending sell-off

23 Mar 2005

Cesky Telecom Group, comprising fixed line operator Cesky Telecom, Czech mobile market leader Eurotel Prague and a number of other minor subsidiaries, has reported consolidated revenues of CZK62.1 billion (USD2.4 billion) for 2004, up from CZK51.4 billion the previous year. The leap in sales reflects the full consolidation of Eurotel Prague in December 2003; Eurotel’s results had hitherto been proportionally consolidated at 51%. Net income for the group came in at CZK5.6 billion, up from a loss of CZK1.8 billion twelve months previously.

In the fixed line division, the 12% growth in revenue from internet, data and value added services failed to compensate for the decline in traditional voice services, leading to overall wireline sales falling by 6% year-on-year to CZK34.4 billion (55% of the group’s revenue). On the wireless side, although Eurotel Prague claimed 376,000 net additions in 2004, boosting the subscriber base by 9% in twelve months to 4.6 million, revenues for the operator grew by only 1%. This can partly be explained by a fall in average revenue per user (ARPU) of almost 10% to CZK504, and traffic revenues decreasing by 8%.

On 31 March 2005 the Czech government will announce who has won the right to purchase its 51.1% stake in Cesky Telecom. Belgian incumbent Belgacom, France Télécom and Spanish telco Telefónica are among the hopefuls.

Czech Republic,O2 Czech Republic (incl. CETIN),

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