Romania’s Romtelecom grows pre-tax profit in second quarter, posts loss in six months

Romanian fixed line telephony company Romtelecom, majority owned by Greek OTE, posted revenues of EUR 332.4 million in the first six months of this year, down 9 percent on the same period in 2010, according to the company. Its second quarter revenues decreased by 7 percent year-on-year, to EUR 166 million, according to OTE’s most recent financial report. On the profit side, its EBITDA (profit before taxes) was of EUR 51.4 million in the first six months of the year, down 38.6 percent on the same period in 2010. The profit for the second quarter of the year however registered an increase of 19.7 percent, reaching EUR 29.2, compared to the same period of 2010. Its net results pointed to a loss of EUR 28.7 million in the first six months, down on the loss of EUR 38.2 million in the first six months of 2010. The loss on the second quarter of the year was diminished from EUR 41.5 million last year, to just EUR 12 million. The revenue decline in Q2’11 was primarily due to a 14% drop in voice services, reflecting a 5% line loss and 9% lower ARPU compared to Q2’10. “While the Romanian economy showed signs of stabilization in the second quarter of the year, the Romanian telecom market remained highly competitive, putting pressure on all operators. Romtelecom’s revenues went down by 7 percent on the same quarter of last year, but we can see visible signs of stabilization; the number of voice lines dropped by 1 percent compared to the first quarter in 2011,” said Anastasios Tzoulas, executive financial director with Romtelecom. Outside of Greece, we are also seeing improved conditions in Romanian fixed-line and cross our mobile footprint with the exception of Albania, whose economy is closely tied to Greece’s, wrote OTE in its financial report. Since the beginning of the year, headcount has been reduced by 99 in Greek fixed-line, 1,447 at Romtelecom and 438 in mobile operations in Greece and internationally, according to OTE. As of July 1, 2011, the Company operated with approximately 7,500 active employees, a 1,500-person decline from June 30, 2010, following the implementation of transformation projects during the year that have dramatically improved productivity. Further improvements from this wellstructured transformation program are expected in coming quarters. Effective July 1, 2011, Stefanos Theocharopoulos, CEO of Cosmote Romania, was appointed CEO of Romtelecom, succeeding Yorgos Ioannidis, according to OTE. The full financial report here. editor@romania-insider.com (photo source: the company)