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Magyar Telekom Q3 profits fall as margins narrow

Third-quarter net income of Magyar Telekom fell an adjusted 23.3% year-on-year to HUF 13.9 billion as costs climbed faster than revenues, an earnings report released late Wednesday shows, according to state news agency MTI.   

Adjusted to exclude the impact of adopting IFRS 15, revenues rose 5.4% to HUF 163.8 bln. Direct costs of sales meanwhile jumped 19.9% to HUF 69.6 bln, causing gross profit to fall 3.3% to HUF 94.2 bln.

A breakdown of revenues by business shows mobile revenue increasing 5.5% to HUF 90.2 bln, while fixed-line revenue rose 2.5% to HUF 50.1 bln. System integration and IT revenue climbed 19.8% to HUF 23.5 bln. Earnings per share came to about HUF 5 in the period.   

MTel confirmed its earlier full-year guidance for revenues of around HUF 630 bln, EBITDA of about HUF 190 bln, and a HUF 25 per-share dividend. 

MTelʼs revenues in Q1-Q3 2018 totaled HUF 482.0 bln. EBITDA reached HUF 145.8 bln.

MTel had total assets of HUF 1,117.3 bln at the end of September, up 0.7% from the end of 2017. Non-current liabilities were down 19.4% at HUF 244.4 bln. MTelʼs net debt ratio edged down from 34.8% to 33.8% during the period.

CEO Tibor Rékasi said MTel is working to achieve its goal of extending fiber coverage to 300,000 more households in 2018.