Magyar Telekom Q1 profit jumps on one-offs, improved margin
Magyar Telekomʼs first-quarter net income more than quadrupled to HUF 10.7 billion from HUF 2.5 bln in the base period on an improved margin and one-off gains, an earnings report published late yesterday shows, according to Hungarian news agency MTI.
Revenue fell 7.6% to HUF 145.1 bln, mainly due to MTelʼs exit from the retail gas business and the transfer of its corporate energy business into a joint venture.
The telco noted that revenue from its core business was up 1.8% during the period.
The profit-and-loss statement shows direct cost of sales fell at an even sharper rate than revenue, dropping 21.4% to HUF 45.4 bln, lifting gross margin 0.4% to HUF 99.6 bln.
EBITDA was up 13.6% at HUF 48.2 bln, supported by HUF 6.5 bln in “other operating income”.
MTel noted a one-off gain of HUF 5.1 bln on the sale of one of its main office buildings and its media company Origo.
Operating profit was up 45.6% at HUF 21.6 bln.
After-tax profit jumped 245.1% to HUF 11.5 bln, over the HUF 8.1 bln estimate by analysts polled by portfolio.hu
Earnings per share stood at HUF 10.3.
CAPEX as a proportion of sales edged up two-tenths of a percentage point to 8%.
MTelʼs gearing ratio fell from 42.9% to 41.8% in the twelve months to the end of March. CEO Christopher Mattheisen noted that the level was “approaching our target range of 30%-40%”.
Guidance included in the report puts revenue at HUF 580 bln-590 bln in 2016 and HUF 585-595 bln in 2017. EBITA is targeted at HUF 187 bln-191 bln for 2016 and HUF 189 bln-193 bln for 2017. MTel sees CAPEX falling 10% year-on-year in both years, though it excludes spectrum acquisitions and annual frequency fee capitalization from the figures.
MTel targets payment of a HUF 25-per-share dividend on 2016 earnings.
SUPPORT THE BUDAPEST BUSINESS JOURNAL
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.