Telenor cuts Opex by NOK 0.5 billion in second quarter

Telenor Group announced its financial results for the second quarter of 2018 indicating a strong revival in its performance.
Telenor Opex Q2 2018Telenor said subscription and traffic revenues grew 0.4 percent, while revenues decreased 3 percent to NOK 27.5 billion.

The main achievement for Telenor was the reduction of Opex (operating cost) by NOK 0.5 billion in Q2. The telecom operator achieved reduction in Opex due to its special focus on growth, efficiency and simplification.

“Across our operations, we continue to execute on simplification and increasing efficiency, while maintaining market positions. These efforts are generating good results, with savings now of a more structural nature. Year to date, Opex has been reduced by close to NOK 1 billion,” said Telenor Group CEO Sigve Brekke.

EBITDA before other items was NOK 11.3 billion with an EBITDA margin of 41.1 percent, which was stable, compared to last year. Organic EBITDA growth was 0.5 percent, Telenor said.

Telenor said its second quarter net income was NOK 2.6 billion, or NOK 1.78 earnings per share.

Capex excluding licences and spectrum was NOK 3.4 billion, resulting in a Capex (capital spending) to sales ratio of 12 percent.
Telenor Capex Q2 2018Telenor added two million mobile subscriptions in the second quarter, and connects 172 million customers.

Telenor recently exited from India by selling its operations to Airtel.

Telenor Opex

Telenor said its efficiency initiatives continue to yield positive results especially in Thailand and Scandinavia. Year to date, Opex decreased by NOK 1.2 billion to NOK 19.3 billion, of which NOK 0.3 billion was related to currency development. The opex reductions were to a large extent attributable to Thailand and Scandinavia.

The 0.5 percent increase in EBITDA to NOK 11.3 billion was driven by Opex reductions and growth in mobile subscription and traffic revenues. Year to date, EBITDA increased by NOK 0.5 billion to NOK 22.6 billion, negatively impacted by currency effects of NOK 0.6 billion.

Telenor said Capex was NOK 3.7 billion – mainly driven by network expansion in Norway and Thailand. Capex for the quarter includes the acquisition of spectrum in Malaysia in the 2100 MHz frequency band of NOK 0.2 billion. Year to date, Capex fell by NOK 1.4 billion to NOK 8.4 billion – due to deferred investments in Norway, Thailand and Pakistan.