Magyar Telekom’s TV revenues increased by 3.4% year-on-year to HUF11 billion (€35.9 million in the third quarter, thanks largely to the growing IPTV subscriber base and ARPUs in its home market Hungary.
Indeed, IPTV subscribers generated 62% of the group’s revenues in Q3.
Results published by the telco show that it ended Q3 in its home market with a total of 978,692 TV customers, or 2.9% more than a year earlier. Blended TV ARPU in Q3 was HUF3,302, up 1.3% on a year earlier. All tolld, the company gained over 65,000 IPTV susbcribers in the yeasr to September 30, driven by new customers additions and migration from cable. Meanwhile, its DTH subscriber base registered a slight decline.
In other Magyar Telekom markets, it ended Q3 with 106,726 TV subscribesr in Macedonia, up 6.3% on a year earlier. However, in Montenegro the TV subscriber total fell by 2.9% to 60,177 over the same period. Overall, the group had revenues of HUF150,606 million (-4.7%) in Q3.
Commenting on the results, CEO Christopher Mattheisen said: “I am pleased to report a 1.2% improvement in our core telco revenues during the third quarter of 2016 driven by mobile equipment and data revenue growth, as well as an increase in TV revenues. The 4.7% decline in our total revenues was primarily driven by the restructuring of our energy business and a temporary slowdown in EU fund inflows which affected SI/IT revenues. Group EBITDA for the quarter grew by 10.0% year- on-year, mainly due to a combination of underlying revenue growth, lower severance related expenses, improving SI/IT gross margin and actual savings from the headcount reduction program implemented over the past two years.
“Our performance in Hungary was supported by the reversal of the EBITDA decline in Macedonia to a 1.9% gain, as the mobile market stabilized. In Montenegro, despite continued regulatory and competitive pressures, the decline in EBITDA decelerated to only 3.8% in the third quarter, largely due to our focus on cost efficiency.
“The popularity of our 4Play Magenta 1 offer has helped to improve our performance in the high-end segment in both Hungary and international subsidiaries. By the end of September this year, we reached almost 100 thousand Magenta 1 subscribers in Hungary alone. As an integrated service provider, with an integrated IP network and highly valued brand, we are in a very advantageous position to maximise the telecommunication share of household wallet spend through further growth in the number of both 3Play and 4Play subscribers.
“Our confidence for the full year is reflected in our decision to raise 2016 revenue and EBITDA targets to around 595 billion and around 193 billion forint, respectively. We no longer expect Digi to enter the mobile market in 2016 whilst household spending power in Hungary is on the rise. Our revenues will also continue to be supported by contribution from residential electricity services, which we do not plan to withdraw before March 2017. We reiterate our CAPEX guidance (excluding any spectrum acquisitions and annual frequency fee capitalisation) for 2016 and previously stated targets for 2017.”
