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Swisscom 9M Net Revenue Falls 4.9%

Swiss incumbent posts 4.9% year-on-year fall in net revenue and 0.7% drop in EBITDA in first nine months

November 9, 2011

2 Min Read

BERNE, Switzerland -- In the first nine months of 2011, Swisscom posted a 4.9% fall in net revenue to CHF 8,538 million and a 0.7% drop in operating income (EBITDA) to CHF 3,520 million. Price erosion in Swiss core business of CHF 438 million failed to be offset by customer and volume growth of CHF 343 million. At constant exchange rates and adjusted for non-recurring items at Fastweb, net revenue was down by 2.6% and EBITDA fell by 3.9% year-on-year. Net revenue posted by Swisscom's Italian subsidiary, Fastweb, fell in local currency terms by 7.8% to EUR 1,295 million as a result of aggressive price competition. Excluding Fastweb, Swisscom’s net revenue decreased by 1.2% to CHF 6,946 million. The 8.4% increase in net income to CHF 1,528 million is attributable to a provision booked in the previous year for VAT proceedings against Fastweb and a one-off amount which Fastweb will receive and which was booked in the third quarter of 2011 in settlement of a lawsuit. The Group's capital expenditure rose by 14.8% to CHF 1,465 million, primarily as a result of increased investments in new-generation networks in Switzerland. The 2.7% increase in the workforce to 20,032 FTEs is attributable to improved customer service, accelerated network expansion and acquisitions. Around 400 new full-time jobs were created in Switzerland. The financial outlook for 2011 remains unchanged. Swisscom continues to expect to pay a minimum dividend per share for 2011 of CHF 21.

The Swisscom Group reported a fall in net revenue of CHF 438 million or 4.9% to CHF 8,538 million in the first nine months of the year and a drop in operating income before depreciation and amortisation (EBITDA) of CHF 26 million or 0.7% to CHF 3,520 million. In the third quarter of 2011 Fastweb booked non-recurring income of EUR 56 million for the settlement of a lawsuit with a competitor. The average exchange rate of CHF/EUR was 11% below the prior-year level. At constant exchange rates and adjusted for a provision booked in the previous year for VAT proceedings against Fastweb as well as the aforementioned non-recurring income, Swisscom's net revenue fell by 2.6% and EBITDA was down by 3.9% on the previous year. Swisscom’s net revenue excluding Fastweb declined by 1.2% to CHF 6,946 million. The rise in net income of CHF 119 million or 8.4% to CHF 1,528 million is primarily attributable to the aforementioned non-recurring items at Fastweb.

Swisscom AG (NYSE: SCM)

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