Telekom Romania sees stable revenues but lower profits in 2015

Telekom Romania, present in the local market since 2014 after the joint rebranding of Romtelecom and COSMOTE Romania, had stable revenues but was less profitable in 2015. The group's two companies,

Telekom Romania Communications and Telekom Romania Mobile Communications, had cumulated revenues of EUR 1.04 billion last year, down by about 1% compared to 2014. The operational profit (EBITDA) went down by 22%, to EUR 205.5 million.

Deutsche Telekom owns majority stakes in Telekom Romania Communications and Telekom Romania Mobile Communications via OTE. Telekom Romania Communications, the former Romtelecom, registered revenues of EUR 601.7 million in 2015, slightly down (minus 1.2%) when compared to the previous year. The ProForma EBITDA (Earnings before Interest, Taxes, Depreciation and Amortization, excluding the impact of restructuring plans) amounted to EUR 118.4 million in 2015, down by 26% compared to 2014.The revenues decline reflects the continuous decrease of fixed voice segment due to fixed-mobile substitution trend, with corresponding revenues lower by 17% at the end of 2015 versus the same period of 2014, according to a statement of Telekom Romania. The lower revenues reflect the continuous decrease of fixed voice segment due to fixed-mobile substitution trend, with corresponding revenues lower by 17% at the end of 2015 versus the same period of 2014, according to a statement of Telekom Romania. However, key areas such as TV and integrated offers continued to generate growth rates for the company. The TV customer base reached 1.45 million at the end of 2015, with corresponding revenues up by 4% last year, compared to 2014. The number of customers who used MagentaONE converged services reached over 208,000 in the fourth quarter, up by more than 48,000 compared to the previous quarter. Meanwhile, the fixed Internet revenues slightly decreased by 3% in 2015 compared to the end of the previous year. Some 1.2 million customers had broadband Internet from Telekom. Telekom Romania Mobile Communications (the former Cosmote Romania) increased its revenues by 7.5% in the fourth quarter of 2015 as compared to the same period the year before, up to EUR 121.1 million, while overall revenues for the year remained stable, at EUR 438.5 million. The EBITDA margin reached 20% in 2015, down by 4 percentage points when compared to 2014. ProForma EBITDA amounted to EUR 87.1 million in 2015. The mobile broadband service revenues registered an advance of 17.7% in the fourth quarter of 2015 as compared to the same period of 2014, and 14% increase year-on-year. The total number of 4G customers as well as the 4G data traffic increased by 80% in Q4 versus Q3 2015. The total customer base (including Zapp) was of 5.75 million at the end of the fourth quarter, up 0.7% compared to the previous quarter. The overall postpaid customer base increased by 3.7% in 2015 versus 2014, accounting for 29% of total customer base. Telekom Romania offers 4G coverage to 57% of the urban population and 32.4% of the total population. Last week,