TDC: Increased earnings but continued pressure on revenue
TDC’s income before depreciation, etc. (EBITDA) increased by 4.4% to DKK 9.8bn during the first nine months of 2008 compared to the same period last year. The EBITDA margin increased from 31.6% to 33.6% during the same period. This appears from TDC’s earnings release for Q3 2008, released to-day.
The increase is mainly due to an increase in broadband and TV customers and lower wages and salaries and pension costs.
“It is very satisfying that we are able to increase our earnings in the Nordic Business which is a difficult market. This underlines that the course we have set with our strategy ”A strong TDC” is now really starting to create results in relation to our focus on cost reductions,” says Jens Alder, President and CEO of TDC.
TDC is upgrading its expectations to net revenue for continuing operations in 2008 to an increase by 30-40% compared to a previous expectation of an in-crease by 10-20%. Apart from more efficient operations the result is expected to increase primarily due to decreasing interest expenses and lower deprecia-tion.
“The upgrade is the positive message in the release, but revenue is still under pressure and the current financial crisis increases the insecurity in the future. That is why we are making a minor downgrade of the years total revenue”, says Jens Alder.
TDC expects that the revenue in 2008 is going to decrease slightly compared to 2007. The pervious outlook expected revenue in 2008 to be level with 2007.
The decrease of revenue is first of all due to declining revenue in the domestic landline business and Sunrise.
Net income from continuing operations excluding special times and fair value adjustments increased by 49% to DKK 3.1bn during the first three quarters of 2008, whilst net interest bearing debt compared to third quarter in 2007 was down with DKK 3.8bn DKK 40.5bn
The EBITDA margin for the Nordic Business, excluding from YouSee, was in-creased to 36.8% during the first three quarters compared to 33.6% during the same period last year.
The full earnings release can be read [here]
Key financial data
DKK m. 1Q-3Q 2008 1Q-3Q
2007 Change in %
Revenue 29,110 29,610 (1.7)
Earnings before depre-ciation and amortization (EBITDA)
9,781 9,370 4.4
EBITDA margin in %
33.6 31.6 -
TDC’s Press Office on tel. + 45 70 20 35 10