Telenor swings to a net loss in first quarter
08 May 2012
Telenor ASA, the Norwegian telecommunications company, has swung to a net loss in the first quarter on a massive impairment charge from Indian operations and revised guidance to exclude Indian operations, as troubles in the country cloud its outlook.
Telenor, majority owned by the Nowegian government, reported a net loss of 390 million crowns ($67.25 million) in the quarter, after a profit of 3.0 billion crowns a year earlier.
The company wrote off the remaining 3.9 billion crown value of its Indian Uninor unit due to the risk of losing its licence.
Telenor previously expected organic revenue growth above 5 per cent in 2012, including India, Ebitda-margin in the range of 32 per cent and 33 per cent and capex to sales at between 12 per cent and 13 per cent.
The Supreme Court earlier this year ordered the cancellation of 122 telecoms licences after a corruption-tainted licensing round and the new proposed fees are so high, Telenor said they would make it "almost impossible" to remain in India.
Telenor repeated that it will be "almost impossible" for it to participate in the renewed licence auction in India, if the recommendation from India's regulator on spectrum auction will be followed.
The firm's earnings before interest, taxes, depreciation and amortisation (EBITDA), excluding the one-off charge, rose 2.9 per cent to 7.62 billion crowns but that was still below forecasts for 7.79 billion crowns.
Telenor said its acquisition of preferred shares in VimpelCom Ltd. in February has been challenged by Russian authorities but added that it is confident that it has complied with Russian laws and regulations.