COPENHAGEN: TDC saw its way clear to raise its full-year earnings forecast to DKK 1.7 billion (€230 million), on the back of an improved third quarter, with broadband growth in Norway offsetting its decline in business and consumer sales at home in Denmark. The operator said it had completed most of its “very large and complex transformation work” in the period, leaving “limited risk” for the remainder of the year.
“We are now so comfortable with the merger and our performance in general, that we are slightly improving our guidance for this year’s operating profit and cash flow,” said Group CEO Pernille Erenbjerg, making reference to the acquisition of YouSee in Denmark in the second quarter.
The CEO added: “We have continued to see a difficult Danish market during the quarter, but our gross profit in Denmark is improving. Earnings in our Danish mobile business have grown organically for the last two quarters, for the first time in five years, and we are again delivering a very strong result in Norway.”
But the transformation work, along with a continued decline in traditional telephony services at home, most notably in the enterprise segment, took its toll again in the three months to September 30. Group revenue declined by 2.3 percent to DKK 5.235 billion (€700 million) in the period, and by 1.5 percent in organic terms, excluding the impact of exchange rates and M&A activity.
Gross profit was DKK 3.939 billion (€530 million), down 3.9 percent (two percent organically), while EBITDA slumped by 11.6 percent (8.5 percent organically) to DKK 2.165 billion (€290 million). In Denmark, EBITDA decreased by 13.1 per cent to DKK 1.834 billion (€250 million). Revenue and gross profit also slipped on a year-ago, falling by 3.2 percent and 4.9 percent, respectively.
The decline in TDC’s home market was keenest in its B2B function, which slipped 8.6 percent in revenue terms and 14.3 percent in EBITDA.
Meanwhile, consumer sales and EBITDA in Denmark fell by 2.7 percent and 5.5 percent, caused by declining fixed voice revenues, as well as continued costs associated with the merger of the TDC and YouSee brands.
TDC’s performance in Norway was generally stronger, with revenue growth of two percent in the period – and a 0.5 percent decline in EBITDA adjusted for one-off costs to a 10.8 percent surge.
The improvement came as Norwegian subsidiary Get introduced mobile telephony targeting existing Get customers with special advantages for customers who have both TV and broadband.
