Its fixed line and mobile subscriber total were unchanged on over 1.2 million and 2.3 million respectively, while the number of broadband retail access lines fell slightly to 623,951 (628,414).
The Croatian incumbent generated revenues of HRK1.6 billion (€210.2 million) in Q1, or 6.2% less than in the corresponding period in 2013.
EBITDA margin before exceptional items was a stable 39.2% and net profit amounted to HRK199 million, or 16.5% down on a year earlier.
Commenting on the results for the first three months of 2014, Davor Tomaskovic, president of the management board and CEO of Hrvatski Telekom, said:
“T-HT holds a firm leading position on the Croatian telecommunications market and the results of the first quarter are in line with our business plans. The economic crisis and regulatory changes continue to have a strong impact on the Company’s performance.
With a view to further strengthening its leading position and achieving good results, at the beginning of 2014 T-HT started its internal transformation in order to make the organisation even more flexible and efficient, as well as fully focused on its customers. We have significantly simplified the organisational structure and redesigned the parts of the organisation where customer-related processes are managed.
The Management Board of HT will have a new Member in charge of customer experience, the Chief Customer Officer, with the aim of raising customer focus to the highest level within the organisation. This new organisational structure will come into force on 1 May.
Along with the internal transformation, this year we also plan, as previously announced, to initiate more significant investments in infrastructure development and service quality improvement, as well as the realisation of potential opportunities for regional business expansion. On 29 April, the General Assembly of the Company supported our proposal for the distribution of the net profit generated in 2013, the aim of which is to increase investments in the development of the Company.
However, our plans to intensify investments are significantly affected by the Government’s announcement of an exponential increase in the annual frequency fees. This will have a strong impact not only on our business operations, but also on the telecommunications sector as a whole.
The increase in the annual cost for frequencies is of such significance that all our previous plans for investments and development of new networks, services, and technologies would have to be significantly reduced.
In order to mitigate the negative impact of such a considerable cost increase and ensure business sustainability, jobs and investments in development, Hrvatski Telekom has no other option but to include such an increase into prices for mobile services.”