& cplSiteName &

Swisscom Makes CHF1.38B Profit Jan-Sept

Light Reading
News Wire Feed
Light Reading
11/8/2012
50%
50%

BERNE, Switzerland -- In the first nine months of 2012 Swisscom posted a fall in net revenue of CHF 111 million or 1.3% to CHF 8,427 million and a drop in operating income before depreciation and amortisation (EBITDA) of CHF 157 million or 4.5% to CHF 3,363 million. On a like-for-like basis and at constant exchange rates, revenue was down by 0.3%, EBITDA fell by 0.7% and net income fell by 1.2%. Also on a like-for-like basis, net revenue in the Swiss business was slightly down versus the prior year (–0.4%) to CHF 6,862 million, while operating income (EBITDA) in the Swiss business also reported a year-on-year decline of 0.4% to CHF 2,931 million. Price erosion amounting to CHF 280 million was almost offset by growth businesses. Capital expenditure in Switzerland was up 36.1% to CHF 1,458 million due to the expansion of broadband networks and costs associated with the mobile frequency auction. Fastweb is on track, with revenue increasing to EUR 1,190 million in local currency (+0.3%) and EBITDA rising to EUR 355 million (+1.1%) on a like-for-like basis. The customer base grew by 144,000 or 9.2% to 1.7 million year-on-year. As a result of one-time restructuring costs amounting to CHF 50 million, Swisscom has revised its EBITDA slightly down for the full year to CHF 4.35 billion. All the Group's other financial projections for full-year 2012 remain unchanged. If all targets are met, Swisscom will again propose a dividend of CHF 22 per share for the 2012 financial year at the next Annual General Meeting.

Swisscom posted a fall in net revenue in the first nine months of 2012 of CHF 111 million or 1.3% to CHF 8,427 million and a drop in operating income before depreciation and amortisation (EBITDA) of CHF 157 million or 4.5% to CHF 3,363 million. The Group's net income declined by CHF 141 million or 9.2% to CHF 1,387 million due to non-recurring items. On a like-for-like basis and at constant exchange rates, revenue was down by 0.3%, EBITDA fell by 0.7% and net income fell by 1.2%. Swisscom's capital expenditure increased by CHF 388 million or 26.5% to CHF 1,853 million.

In the Swiss business, Swisscom posted net revenue of CHF 6,862 million (–0.4%) and EBITDA of CHF 2,931 million (–2.2%). Adjusted for non-recurring expenses, EBITDA for the Swiss business posted a year-on-year decline of 0.4% on a like-for-like basis. Capital expenditure in Switzerland was up CHF 387 million or 36.1% to CHF 1,458 million due to the expansion of broadband networks and costs of CHF 360 million in connection with the mobile frequency auction in the first quarter of 2012.

Sharp decline in traditional business almost offset
Price erosion in the Swiss market amounting to CHF 280 million was almost offset by growth businesses worth CHF 255 million. The trend towards bundled offerings and new price models such as flat-rate tariffs continued during the reporting period. At the end of September, 739,000 customers (+31.3% or +176,000 year-on-year) were already taking advantage of Swisscom's combined offerings such as Vivo Casa and Vivo Tutto, which comprise fixed line access with telephony, Internet and TV or an additional mobile line.

The new Natel infinity mobile subscriptions launched by Swisscom in June 2012, which allow unlimited calling, texting and Internet on all networks, met with a very positive response from customers. At the end of October 2012 630,000 customers were already taking advantage of these new Infinity offerings. The decline in average revenue per user (ARPU) among customers who have switched to Natel infinity is currently CHF 6 per month on average. Swisscom expects the decline in ARPU to continue to slow over the next few months.

The number of mobile lines grew by 173,000 or 2.9% to 6.2 million versus the prior year. The number of postpaid customers grew by 60,000 in the third quarter (single subscriptions and bundled offerings), while the number of prepaid customers fell by 21,000. In the first nine months of 2012 Swisscom sold 998,000 mobile handsets (+1.0%), around 66% of which were smartphones. The number of Swisscom TV connections increased year-on-year by 172,000 or 30.9% to 728,000 (+34,000 in the third quarter). The number of fixed line broadband connections rose by 73,000 or 4.5% to 1.71 million versus September 2011 (+14,000 in the third quarter).

Fastweb grows customer base to 1.7 million
Fastweb increased net revenue excluding hubbing (wholesale revenue from interconnection services) by 0.3% to EUR 1,190 million in local currency. Adjusted for non-recurring income of EUR 56 million resulting from the settlement of a legal dispute with another telecoms provider in 2011, the segment result before depreciation and amortisation rose by 1.1% to EUR 355 million. Fastweb's customer base grew by 144,000 or 9.2% to 1.7 million in the space of a year (+31,000 in the third quarter). Fastweb has posted three times more net customer gains in 2012 than in 2011. The bundled TV and broadband offering launched a year ago in partnership with Sky Italia has attracted 123,000 customers to date.

Financial outlook adjusted for EBITDA
As a result of non-recurring costs amounting to CHF 50 million in connection with the changes in headcount, Swisscom has revised its EBITDA figure down for the full-year from CHF 4.4 billion to CHF 4.35 billion. Other financial projections for full-year 2012 remain unchanged. Swisscom expects net revenue of CHF 11.3 billion and capital expenditure of up to CHF 2.2 billion (excluding expenditure on mobile frequencies amounting to CHF 360 million). Excluding low-margin wholesale business (hubbing), Fastweb expects revenue to remain stable at EUR 1.6 billion. Fastweb is expected to close 2012 with slightly higher EBITDA and slightly lower capital expenditure compared with 2011. If all targets are met, Swisscom will again propose a dividend of CHF 22 per share for the 2012 financial year at the next Annual General Meeting.

Swisscom AG (NYSE: SCM)

(0)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
Featured Video
From The Founder
Light Reading is spending much of this year digging into the details of how automation technology will impact the comms market, but let's take a moment to also look at how automation is set to overturn the current world order by the middle of the century.
Flash Poll
Upcoming Live Events
November 1, 2017, The Royal Garden Hotel
November 1, 2017, The Montcalm Marble Arch
November 2, 2017, 8 Northumberland Avenue, London, UK
November 2, 2017, 8 Northumberland Avenue London
November 10, 2017, The Westin Times Square, New York, NY
November 16, 2017, ExCel Centre, London
November 30, 2017, The Westin Times Square
May 14-17, 2018, Austin Convention Center
All Upcoming Live Events
Infographics
With the mobile ecosystem becoming increasingly vulnerable to security threats, AdaptiveMobile has laid out some of the key considerations for the wireless community.
Hot Topics
Muni Policies Stymie Edge Computing
Carol Wilson, Editor-at-large, 10/17/2017
Pai's FCC Raises Alarms at Competitive Carriers
Carol Wilson, Editor-at-large, 10/16/2017
Is US Lurching Back to Monopoly Status?
Carol Wilson, Editor-at-large, 10/16/2017
'Brutal' Automation & the Looming Workforce Cull
Iain Morris, News Editor, 10/18/2017
Worried About Bandwidth for 4K? Here Comes 8K!
Aditya Kishore, Practice Leader, Video Transformation, Telco Transformation, 10/17/2017
Animals with Phones
Live Digital Audio

Understanding the full experience of women in technology requires starting at the collegiate level (or sooner) and studying the technologies women are involved with, company cultures they're part of and personal experiences of individuals.

During this WiC radio show, we will talk with Nicole Engelbert, the director of Research & Analysis for Ovum Technology and a 23-year telecom industry veteran, about her experiences and perspectives on women in tech. Engelbert covers infrastructure, applications and industries for Ovum, but she is also involved in the research firm's higher education team and has helped colleges and universities globally leverage technology as a strategy for improving recruitment, retention and graduation performance.

She will share her unique insight into the collegiate level, where women pursuing engineering and STEM-related degrees is dwindling. Engelbert will also reveal new, original Ovum research on the topics of artificial intelligence, the Internet of Things, security and augmented reality, as well as discuss what each of those technologies might mean for women in our field. As always, we'll also leave plenty of time to answer all your questions live on the air and chat board.

Like Us on Facebook
Twitter Feed