By Nicole Lundeen
VIENNA-- Telekom Austria AG said late Tuesday it swung to a net
loss in 2014 as macroeconomic conditions in its Central and Eastern
European markets and declining revenue in its home market of
Austria weighed on results.
For the year, Telekom Austria's net loss was EUR185.4 million
($210.0 million), compared with a 2013 net profit of EUR52.1
million in 2013. For the fourth quarter, the Austrian
telecommunications company halved its net loss to EUR48.9 million
from a year-earlier loss of EUR107.1 million.
Revenue for the quarter decreased 2.4% to EUR1.03 billion and
fell short of analyst expectations for EUR1.05 billion. For the
full year, revenue fell 4.0% to EUR4.02 billion.
Telekom Austria, which operates in seven Central and Eastern
European markets, said higher revenue in Belarus and its additional
markets segment failed to offset declines in Austria, Bulgaria and
Croatia. Regulatory effects also weighed on earnings last year,
with a negative impact EUR128.2 million, Telekom Austria said.
The company plans to pay a dividend of EUR0.05 a share in 2014
and 2015. While the company expects macroeconomic pressures,
regulatory intervention and price competition to remain for the
time being, it sees revenues increasing 2.0% in 2015. It is also
planning expenditures between EUR700 million and EUR750 million
this year. The spending includes investments to expand its fiber
network, for which it has earmarked a total EUR400 million between
2015 and 2018. It also plans to purchase additional spectrum in
Bulgaria, Slovenia and Serbia in 2015.
Mexican communications giant America Movil acquired just under
60% of Telekom Austria in 2014 and plans to use the Austrian
company as a base for acquisitions and expansion in Central and
Eastern Europe. Telekom Austria's second-largest shareholder is the
Austrian Republic's holding company, which signed a shareholder
agreement with America Movil giving the Mexican company operational
control.
Write to Nicole Lundeen at nicole.lundeen@wsj.com
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