Dutch incumbent’s Q2 profit up 4.8% y-o-y

23 Jul 2009

Dutch telecom group KPN, or Royal KPN as it is also known, reported a 4.8% year-on-year rise in second-quarter profits, driven by growth at its German business and better margins in its home market. The group said net income reached EUR370 million (USD526 million) in the three months to 30 June 2009, compared with EUR353 million in Q2 2008, although revenues dipped 6.9% to EUR3.41 billion, largely the result of the sale of some consulting businesses in the first half of the year; without the impact of the asset sales, the operator’s revenue would have fallen 2% y-o-y. In a statement, KPN’s chief executive officer Ad Scheepbouwer said: ‘We continue to see limited economic impact on consumer markets but business markets are being impacted and there are no signs of economic recovery as yet.’ The operator carries net debt of EUR11.8 billion and has been reducing its workforce to cut costs. It shed a further 136 jobs in 2Q09, bringing the year-to-date total for jobs lost to 1,200. It now employs 35,502 people – 7,103 lower than before its economy drive began.

The CEO went on to say: ‘KPN has delivered a resilient performance whilst maintaining market shares this quarter in the face of economic and regulatory challenges and we are on track to deliver around EUR2.4 billion free cash flow for the year. The Dutch telco business performed well in the quarter, delivering strong EBITDA growth. Getronics performed solidly and is poised for recovery, though iBasis’ revenue performance was disappointing. In Mobile International there was continued EBITDA growth, driven by our ‘challenger’ strategy. We continue to … focus on EBITDA and cash flow in this market rather than on revenues. We therefore adjust our revenue guidance and are confirming our EBITDA, free cash flow and dividend per share guidance for 2009 and 2010.’

Netherlands,KPN,

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