These aren’t the best of times for Telekom Romania.
The year began with a major change at the top, with Miroslav Majoros, the CEO Of Slovak Telekom, replacing Nikolai Beckers. Although the latter’s mandate ran out at the end of 2015, it was also no secret that the company was not performing as well as expected. Indeed, its revenues fell below €1 billion and profits by 23% to €205 million last year.
Despite a major rebrand in September 2014 and a subsequent focus on fixed-mobile packages, Telekom Romania lost broadband internet and mobile customers while at the same time seeing its TV subscriber base grow.
In March this year Majoros said that the company planned to stabilise and then restart its business to growth, with the investment budget for 2015 being increased by 35% to €180 million. It would be mainly spent on its fibre-optic network and mobile 3G and 4G technologies.
However, this measure was deemed to be insufficient by Romania’s Ministry of Communications and Information Society (MCSI) and last month it called for “bold actions” to turn round the company’s fortunes.
Given that the Romanian state holds a 46% stake in Telekom Romania, the MCSI’s views will certainly have been taken aboard.
As for the company’s Q1 results, which appeared earlier this week alongside those of its parent company OTE, itself backed by Deutsche Telekom, they provided something of a mixed picture.
On the plus side, and in keeping with recent trends, the number of TV – and by that we mean IPTV, DTH and cable combined – subscribers increased by 2.5% year-on-year to 1,449,190 as of March 31. However, its fixed broadband subscriber total fell by 1.8% over the same period to 1,195,923 and mobile subscribers were also down, by 4% year-on-year.
Although the company’s revenues were down, by 7.8% year-on-year to €137.1 million in the fixed sector, Telekom Romania identified its integrated fixed-mobile offer MagentaONE as a growth engine, with the 270,000 customers receiving the service at the end of March being 62,000 more than three months earlier.
It was also noted that growth in revenues from IPTV was higher than for other TV services compared to a year earlier. Moreover, it gained fixed broadband internet subscribers in the first quarter.
It will be interesting to see how Telekom Romania now performs in the three remaining quarters of this year, and into 2017, in what is one of the moost competitive markets in Central and Eastern Europe.
