Telenor Quarterly Profit Jumps 7-Fold

In the second quarter of 2010, Telenor Group reported revenues of NOK 25.2 billion (US$4 billion), representing an organic revenue growth of 5 per cent. The EBITDA margin in the second quarter of 2010 was 28 per cent, and operating cash flow margin was 16 per cent.

Net profit jumped seven-fold from NOK 1.36 billion (US4216 million) to NOK 9.5 billion (US$1.5 billion), mainly due to strong revenue from Asia and a gain from the merger of two associated companies. Adjusted operating profit was down to NOK 2.9 billion (US$460 million), compared to NOK 4 billion (US$635 million) a year ago.

Telenor's mobile operations added 5.4 million subscriptions during the quarter.

"I am pleased to see that the positive trends continued into the second quarter with increasing organic revenue growth and solid margins. During the quarter our consolidated operations added 5.4 million mobile subscriptions and in Asia we had organic revenue growth of 13 per cent," said Jon Fredrik Baksaas, President and CEO of Telenor.

"The economic environment in Asia continued to improve, fuelling the revenue growth in our operations. Increased usage of smartphones is an additional driver for growth in Thailand and Malaysia. In June, we launched services in five additional circles in India, increasing our footprint to 13 circles. We are continuously working to increase revenues and develop Uninor's position in the market," said Jon Fredrik Baksaas.

"In the Nordic region, high demand for mobile data is contributing to the solid growth in organic mobile revenues. The mobile network upgrades are on track, with pick-up in investments in the coming quarters. In addition, the work on further cost reductions will continue," said Jon Fredrik Baksaas.

"Based on the positive trends in Asia and the Nordics, we expect organic revenue growth to be slightly higher than indicated in our previous outlook. In addition, we revise our expected capex to sales ratio downwards, following lower overall investments so far this year," said Jon Fredrik Baksaas.