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Telekom Austria Promises Dividend.

Telekom Austria AG has announced its first ever dividend after posting improved financial results for 2003. For the fourth quarter, the operator posted a narrowed net loss of 21.2m euros ($25.9m), compared with a net loss of 99.2m euros ($121.2m) in the same quarter in 2002.

Analysts had expected a loss of 37m euros ($45.2m). Revenue rose 1% to 1.02bn euros ($1.24bn) from 1.01bn euros ($1.23bn). For the full year, it posted net income of 134.2m euros ($164m) compared with 12.8m euros ($15.6m) in 2002. Total group revenues increased 1.6% to 3.97bn euros ($4.84bn). The improved results were brought about by cost cuts and growing sales at its international wireless units.

The Vienna-based telco has been shedding jobs and relying on its international mobile phone business for growth as it struggles to boost sales at home. Almost 90% of the Austrian population owned a mobile phone at the end of 2003.

During the fourth quarter, its wireless unit's sales rose 5.5% to 519.9m euros ($634.6m) from 492.6m euros ($601.3m). Subscribers at the Mobilkom unit rose 6.4% in 2003 to more than 4.7 million. The unit has expanded in eastern and central Europe as the home market became saturated.

Like most other telecom operators, fourth-quarter fixed-line sales fell 5.1% to 565.9m euros ($690.8m) from 596.6m euros ($728.2m) a year earlier.

Net debt continued to decline during 2003 as a result of strong cash flow. Total net debt fell to 2.63bn euros ($3.21bn) at the end of December 2003, compared with 3.20bn euros ($3.91bn) at the end of December 2002. This is in spite of paying 69.7m euros ($85m) to increase its stake in VIPnet from 71% to 99%.

It also revealed plans to pay a 0.13 euro ($0.16) dividend for 2003, and said it will buy back as many as 23.8 million shares, tapping a reserve of as much as 270m euros ($330m).

Looking forward, the operator expects net income to increase 10% in 2004, not including Austria's planned tax-law changes.
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Publication:Computergram International
Article Type:Brief Article
Geographic Code:4EUAU
Date:Mar 25, 2004
Words:365
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