In its latest set of results, the company notes that this will be principally due to reduced roaming, which heavily impacted its Q2 performance. It also now expects to make CAPEX cuts of around 25% compared to an initial projection of €770 million. The group had total revenues of €1,095.7 million in Q2, down 2.4% on a year earlier. They only grew in one of its markets (Bulgaria, up 5.3% year-on-year), while the biggest fall (-6.8%) was seen in Croatia.
Total EBITDA in Q2 amounted to €390.1 million, down 0.5% on a year earlier. In CEE, the number of access lines in Q2 stood at 552,300 (+1.8%) in Bulgaria, 281,800 (-5.5%) in Croatia, 380,900 (-6%) in Belarus, 85,900 (+10.4%) in Slovenia and 153,500 (+0.9%) in North Macedonia.
Commenting on the Q2 results, Thomas Arnoldner, CEO of A1 Telekom Austria Group, said: “In the second quarter a strong operating performance enabled us to mitigate Covid-19 and foreign exchange effects. Revenues declined by 2.4% due to Covid-19-related roaming losses, lower equipment revenues and foreign exchange effects. Group EBITDA before restructuring increased slightly by 0.5%.
“The net result for Q2 was €113.8 million, 62.7% higher than in the same period of the previous year, both periods being significantly impacted by tax cases in Bulgaria.
“We now provide an outlook again for the full year 2020. Due to the Covid-19 and foreign exchange effects, we expect a moderate decline in revenues of approximately 2%.
“The group continues to benefit from its operational strength and solid capital structure. Furthermore, we see that the Covid-19 crisis has given digitalisation a boost: from e-learning, videoconferencing and TV streaming to security solutions, e-health and cloud services. A high-performance broadband infrastructure and smart solutions are becoming increasingly important and are also in demand in the longer term.”
Alejandro Plater, COO of A1 Telekom Austria Group, added: “Austria recorded a positive development and saw growth in the number of mobile contract customers by 1.6% in the second quarter, with demand for high-value tariffs and WiFi-routers being very strong. For business customers, the focus was on home office solutions and bandwidth upgrades. Overall, EBITDA growth before restructuring was 0.4% despite roaming losses.
“The CEE markets also saw good operational development. Excluding foreign exchange effects, which mainly affected Belarus, revenue increased by 1.3% and EBITDA before restructuring by 3.2%.
“As the further effects of Covid-19 are difficult to predict, precautionary cuts in capital expenditure and operating expenses will help to further secure flexibility”.