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Dutch telecom company, KPN witnessed a huge growth of 42% in Q1. Its local revenue losses were overshadowed by its profits in the international unit.
The company gained a total net profit of about €449 million in 1Q10. This was a significant improvement when compared to the profit made in 1Q09 which was only €317 million. It also grew its EBITDA by a healthy 7.2% to € 1.2 billion. On the other hand its year on year revenue was down by three and a half percent to 3.3 billion euros. This decrease happened because of KPN’s Dutch unit in which the net revenue declined considerably. But its year on year revenue in its Mobile International units increased by 1.8% to € 999 million.
Mobile International works mainly in Belgium and Germany. However, its rest of the world revenue grew by a mouth widening 81% to 29 million euros.
Ad Scheepbouwer, the CEO for KPN, stated that the company’s Q1 performance was good especially when one notices that they had to face a lot of pressure generated by the economic conditions of the business markets.
However, Scheepbouwer added that KPN was looking out for FY10 in which it has targeted an EBITDA of more than € 5.5 billion and a total earning of € 13.5 billion.
Prominent analysts mention that the slow performance of KPN is not a unique issue. It would be reflected in the performance of all the major companies in the area like Deutsche Telekom, Telecom Italia and BT. They expect that Deutsche Telekom would witness an EBITDA decrease of approximately 2-4%, Telecom Italia would face a service revenue fall of close to 10 % and BT will also have to handle a revenue decline of something between 3 to 4%. The only telecom company that is believed to avoid this plummet is Vodafone which will probably enjoy 1.8% increase in its European revenue. However, Vodafone will enjoy an even better increase in world revenue which will be something close to 9%.
