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TeliaSonera sees profits tumble

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TeliaSonera sees profits tumble
Telia Head Johan Dennelind. Photo: TT
12:56 CEST+02:00
Swedish-Finnish telecom operator TeliaSonera has announced falling third quarter profits, citing fierce competition for corporate clients but held its outlook for 2014.
But Chief Executive Johan Dennelind said in a statement that the group had "solid" profitability in the central Asia region -- Kazakhstan, Uzbekistan, Azerbaijan and Georgia --, where it has expanded in recent years as its European markets stagnated.
   
Overall net profit fell by 12 percent by 4.073 billion kronor ($570 million).
   
Sales were almost stable with a 0.2-percent increase to 25.464 billion kronor.
   
Profits had also fallen by 12-percent profit in the second quarter, after which TeliaSonera revised its outlook, setting more modest goals: sales in local currencies "slightly below the level in 2013".
   
But it held to an unchanged underlying profit margin on the basis of earnings before interest, tax, depreciation and amortisation (Ebitda).
   
In July, TeliaSonera continued to expand in Europe buying competitor Tele2's Norwegian operations for 5.1 billion kronor.
   
After a 4.9-percent revenue drop at its Spanish subsidiary Yoigo, the group said it was considering selling the operation.
   
In Kazakhstan, the firm's operator Kcell was subject to an investigation which revealed that "a number of the company's external supplier contracts were entered into in breach of the company's own internal policies and procedures", which has led to a partial renewal of the executive board.
   
TeliaSonera, the result of a merger of the historical Swedish and Finnish operators, expects to further improve its cost-cutting measures.
   
"Sustainable cost savings can only be achieved if we exit legacy structures and reduce complexity across the group," Dennelind said.
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