For the fourth quarter, the carrier posted net income of 25m euros ($33.5m), compared to a net loss of 15.6m euros ($21m) for the fourth quarter 2003. Analysts had been expecting a net loss of 3.1m euros ($4.1m). Sales showed a modest 0.6% increase to 1.02bn euros ($1.37bn).
Meanwhile, for the year ending December 31, the Vienna-based carrier posted a 69.4% rise in consolidated net income to 227.3m euros ($305m), due in part to lower net interest and higher tax expenses. Revenue rose 2.2% to 4.05bn euros ($5.44bn).
Telekom Austria employs 13,900 people, and by the end of 2004 had approximately 4.95 million mobile subscribers, up from 4.74 million a year earlier. Its domestic wireless market share fell to 41% from 43.3%.
In November 2004, Telekom Austria agreed to buy Bulgaria’s leading mobile operator MobilTel for 1.6bn euros ($2.12bn). The carrier already had mobile interests in Croatia, Slovenia, and Liechtenstein, and had set aside 2bn euros ($2.68bn) for takeovers, including the MobilTel purchase.
The attraction of eastern Europe is that mobile penetration is low and the potential for growth is enormous, as witnessed by Vodafone’s recent $3.5bn spending spree on two eastern European mobile operators.
Telekom Austria will pay a 2004 dividend of $0.24 a share, compared with $0.13 for 2003. The company also said it will expand its share buyback program. Looking forward, it said it plans to increase the portion of profit it pays as dividend to 65% this year from 50% for 2004.
Unlike some European carriers that are saddled with massive debt burdens, Telekom Austria has a relatively modest net debt of 1.97bn euros ($2.64bn), which was down 25% from the previous year.
