Second quarter 2011: Steady growth and stable margins

Telenor Group | July 21, 2011 | Press Release

In the second quarter of 2011, Telenor Group reported revenues of NOK 24,4 billion, representing an organic revenue growth of 7%. EBITDA before other items was NOK 7.5 billion, EBITDA margin was 31 per cent, and operating cash flow was NOK 5 billion.

“Half way into 2011, we have captured growth opportunities and delivered another quarter with 7 percent organic revenue growth combined with steady customer growth and healthy margins. The Telenor Group achieved an operating cash flow margin of 20 percent in a period with heavy investments in networks to meet the strong growth in data,” said Jon Fredrik Baksaas, President and CEO of Telenor Group.

Added 8 million subscribers

“Our mobile operations added close to 8 million subscribers during the quarter, driven by our Asian operations, similar to the first three months of this year. In the Nordics, the new service offerings launched previously this year have had positive effects. All three operations are now attracting new customers who will benefit from attractive bundles and higher data speeds. I am especially pleased to see the mobile subscriber base growing again in Norway and that the growth in data revenues continues to compensate for price pressure on voice. In June, we experienced a major network outage in Norway. The cause has been identified and corrective measures are taken to prevent similar incidents. Our Asian operations once again confirmed the strong growth momentum in the region with 21 percent organic revenue growth,” Baksaas said.

India

“In India, the 2G licence investigations continue. Telenor is a long term telecom operator in India with already more than 20 million subscribers. The licences were awarded prior to Telenor’s entry to India and we have invested according to Indian authorities’ guidelines and formal approvals. Hence, we anticipate that the outcome of the legal processes should not affect our business negatively,” Baksaas said.

Capturing growth opportunities

“Going forward, we will continue to capture organic growth opportunities through providing easy-to-use and high quality services and implement ambitious efficiency measures while at the same time continue our substantial network modernisation.  This quarter alone we invested more than one billion NOK in future technologies in Norway,” Baksaas said.

New share buy-back programme

“I am pleased to announce that we will initiate a new share buy-back programme for 2011 for approximately 3 percent of the outstanding shares based on our strong financial position. With the dividends paid in June and this new programme, we confirm our ambition to deliver a competitive shareholder remuneration,” Baksaas said.

Maintained outlook for 2011, stronger cash flow

“Based on the trends so far this year, we maintain our revenue guidance for the year and expect a somewhat stronger cash flow than indicated earlier,” Baksaas ended.

Key figures

The table below contains key figures for the second quarter and first half year of 2011, compared to the previous year:

Press release via Telenor Group