February 12, 2019 / 6:13 PM / 3 months ago

A1 Telekom Austria books 30 percent profit drop, but ups dividend

VIENNA (Reuters) - A1 Telekom Austria reported a 30 percent fall in its full-year net profit on Tuesday, hurt by investment in digitalisation, restructuring, advertising and higher taxes.

Austria’s leading telecommunications and data services provider, majority-owned by Mexican tycoon Carlos Slim’s America Movil, said it will nonetheless propose to raise its dividend for 2018 by 1 cent to 0.21 euros per share.

The company, in which the Austrian state also holds a 28.4 percent stake, said it booked a net profit of 242.7 million euros ($274.7 million) in 2018.

Full-year earnings before interest, tax, depreciation and amortisation (EBITDA), excluding restructuring costs, rose 1.6 percent to 1.40 billion euros. Earnings grew in Austria, Croatia, Bulgaria, Belarus and Macedonia, but not in Slovenia and Belarus.

Revenues increased by 1.8 percent to 4.47 billion euros, helped by high demand for mobile wifi routers in Austria, where the group makes more than half its revenue. It forecast revenue would increase 2 percent this year.

A1 Telekom Austria has been heavily investing in rebranding all its operations into the A1 brand and is preparing for Austria’s first 5G auction of the 3.4 to 3.8 GHz band.

The auction will mainly speed up data services in densely populated areas and is scheduled for later this month.

“We are well on the way to transforming our company from a traditional telecommunications provider into a digital service provider,” said Chief Executive Thomas Arnoldner in a statement.

The group said it plans to invest 770 million euros in 2019, but that this sum did not include investment in spectrum or acquisition.

Reporting by Kirsti Knolle; Editing by Edmund Blair and Jan Harvey

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