Telekom Romania stops revenue decline but profit continues to drop

Telekom Romania, the second-biggest telecom group on the local market, registered revenues of EUR 985 million in 2016, up from EUR 984 million in 2015, according to the annual report of parent-group Deutsche Telekom. The operational profit before interest, depreciation and amortization (EBITDA), went down by 14.6% to EUR 175 million. The Deutsche Telekom group also recorded EUR 44 million worth of impairments on the book value of its mobile communications operations in Romania as a result of more pessimistic outlook for the business taken into account in the annual planning process. Telekom Romania continued to lose mobile customers last year, at an accelerated pace. The company had 5.72 million mobile clients at the end of December 2016, down by 270,000 (4.5%) compared to December 2015, when the group had 5.99 million mobile clients. The number of fixed-network lines also went down by 122,000 last year, reaching 1.97 million at the end of December, according to Deutsche Telekom’s report. The broadband internet segment is the only one on which Telekom saw a small increase last year, reaching 1.19 million clients, up 0.7% year-on-year. Telekom Romania must give up the “engineering” way of thinking and start the attack with a “challenger” mindset to end the period of lowering revenues and return to growth on all the key business segments, said Srini Gopalan, the new head of the European operations of Deutsche Telekom (DT), quoted by local Ziarul Financiar. The group has a fixed and mobile communications infrastructure that can be better used. The company “needs to get the most of the assets it has”, he explained. Media: Deutsche Telekom, in talks with competitors over potential sale of Romanian operations editor@romania-insider.com