Telenor Group reported financial result for the first quarter of 2021 and said it achieved 7 percent cut in Opex due to investment in digital initiatives.

The Group’s mobile subscriber base grew by 5 million, including 2 million added in Myanmar. The subscriber base was 187 million at the end of the first quarter.

Subscription and traffic revenues decreased by 4 percent. Telenor said reported revenues were NOK 28.9 billion, a decrease of NOK 2.1 billion.

Currency adjusted Capex decreased by NOK 0.7 billion, or 7 percent. Reported  opex decreased by NOK 1.1 billion.

Organic EBITDA decreased by 2 percent, as the decline in subscription and traffic revenues was only partly offset by the reduction in operating expenses. Reported EBITDA before other items was NOK 13.0 billion and the EBITDA margin was 45 percent.

Capex excluding licences and spectrum was NOK 3.7 billion, yielding a capex to sales ratio of 13 percent.

Reported net income was negative NOK 3.9 billion. Decrease in operating profit due to the impairment of Telenor Myanmar of NOK 6.5 billion and higher taxes were only partly offset by positive development in net financial items.

Total free cash flow was NOK 3.8 billion.

Leverage decreased to 1.8x at the end of the first quarter from 2.0x at the end of the previous quarter.

Telenor said its investment in digitalisation enabled the telecom operator to add 5 million subscribers and yielding an Opex decrease of 7 percent.

“Despite a decline in subscription and traffic revenues of 4 percent, this enabled Telenor to deliver an organic EBITDA decline of 2 percent and a free cash flow of NOK 3.8 billion,” Sigve Brekke, President and CEO, Telenor Group, said.

The Nordic operations delivered a robust quarter with EBITDA growth in Finland and Denmark. Despite the pandemic impacting our Asian operations over the last twelve months, we have been able to adapt and deliver strong customer intake across our operations.

For the full year 2021, excluding Myanmar, Telenor re-iterates the expectation of organic subscription and traffic revenues and EBITDA to remain around the 2020 level and Capex to sales ratio of 15-16 percent.