March 26, 2020 / 10:26 AM / 15 days ago

UPDATE 1-Germany's Drillisch sees no distortions from coronavirus

(Adds further CEO comment)

BERLIN, March 26 (Reuters) - German alternative telecoms company 1&1 Drillisch is not seeing any distortions to its business from the coronavirus pandemic, CEO Ralph Dommermuth said on Thursday, forecasting stable results this year.

Drillisch should add half a million customers this year and report revenues roughly in line with last year, added Dommermuth after it reported a 1.1% rise in revenues in 2019 and a decline in core earnings due to one-off costs.

“Our business is stable,” said Dommermuth, who also runs and is the biggest shareholder in United Internet, a communications business that in turn controls Drillisch.

Highlighting his industry’s defensive characteristics in a time of crisis, Dommermuth said Drillisch expected to add 100,000 new customers in the first quarter. That rate of increase could accelerate in the second quarter as fewer people cancel contracts.

The company, a virtual mobile network operator that rents capacity mainly from Telefonica Deutschland, acquired spectrum for 5G services at auction last year and is setting its sights on building its own network.

Talks with Germany’s three main network operators on national roaming are going slowly, Dommermuth said, after they took legal action over the terms of a 5G auction that they say are onerous.

This, in turn, is delaying talks with vendors to supply equipment for Drillisch’s own network.

“We have held preliminary talks. We know what to build. But we aren’t yet at the point where we can enter the final round,” Dommermuth told reporters. (Reporting by Douglas Busvine; editing by Michelle Martin)

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