Romtelecom revenues drop, Cosmote on the up in Q1

Romtelecom, part of the Greek group OTE, posted 3.3 percent lower revenues in the first quarter of the year, at EUR 194.8 million. Its EBITDA also fell by 20.2 percent to EUR 59.3 million. On a comparative basis, in the first quarter of 2009, Romtelecom had revenues of EUR 201.4 million and an EBITDA of EUR 74.3 million. At the end of the first quarter, the operator had a total of nearly 4.5 million revenue generating units (RGUs).

Landline customers went down by 7.9 percent from 2.93 million to 2.7 million. However, users of fixed and mobile internet services grew 18.5 percent to surpass 830,000. The total number of consumers of TV services amounted to 893,757, up by 23.4 percent.

Romtelecom’s number of employees fell below 10,000 as the company outsourced some operations.

“Clients, both residential and corporate customers, are still focused on the cost of telecom services, and we are striving to come up with offers to satisfy their needs, but it is natural that the impact is felt at the level of revenues and profitability,” said Yorgos Ioannidis, GM of Romtelecom. “The profitability rate was negatively affected during this quarter by a significant growth in content-generated costs and provisions for debts.”

Three months since the partial launch of the Dolce Interactiv service, the operator has acquired over 4,000 clients. Customers who use VDSL technology for broadband internet, available in 10 cities, number 8,000. Mobile services, including mobile internet, had approximately 40,000 customers at the end of Q1, 2010. Romtelecom administered over 18,000 computers at the end of Q1, 2010, which is almost double compared to the beginning of the year.

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Elsewhere, Cosmote Romania, the third biggest mobile player on the local market, posted revenues of EUR 114.8 million, up 13.3 percent in the first quarter of the year ended March 31, 2010. Its EBITDA plunged by 56.3 percent to EUR 6.6 million, due to the Zapp integration. As of the end of Q1, 2010, Cosmote’s total customer base in Romania reached 7.2 million, of which 21 percent was postpaid.

Excluding Zapp, the drop in EBITDA for the quarter would be 27 percent, primarily reflecting higher network expenses as well as selling and distribution costs; in addition, the sharp drop in international incoming interconnection rates directly affected profitability.

Having reached a market share in excess of 23 percent and now able to offer 3G services after the acquisition of Zapp, Cosmote Romania is focusing on expanding its presence in the broadband and corporate markets.

Otilia Haraga