KPN’s Q4 profits drop sharply; forecasts growth in 2009
The Netherlands’ dominant telecoms group Royal KPN has reported a sharp fall in net income for the three months to 31 December 2008, but said it was not being affected by the global economic recession and fully expects to record growth in the coming fiscal year. KPN reported fourth-quarter net profits of EUR295 million (USD383 million), down from EUR1.58 billion in the corresponding period of 2007 when the telco booked a one-off tax gain of EUR1.2 billion. Revenues in the October-December 2008 quarter amounted to EUR3.72 billion, a marginal 1.6% rise from EUR3.66 billion previously, bolstered in the main by growth at KPN’s German mobile telephony arm, E-Plus. For the full year, KPN said 2008 net profit slumped by 50% to EUR1.34 billion, although sales rose by 16% to EUR14.6 billion.
KPN reported that fewer customers are cancelling fixed line subscriptions in the Netherlands, adding that operating earnings at its domestic operation grew slightly for the first time in years. ‘KPN experienced only a limited impact on its operational performance from the economic downturn in the fourth quarter,’ the company said in a press release, before repeating its forecasts for 2010 of EUR15 billion (sales) and EUR5.5 billion (operating profit), equivalent to growth of around 3% and 9% on 2008 levels.