Telenor Announces Strong Quarterly Results for Q2 2014

Telenor Pakistan announced interim results for second quarter of 2014 this Wednesday which show strong growth in subscriber base and total revenue for the second largest telecom operator of the country.

According to the quarterly results, Telenor added 1.503 million new subscribers during Q2, after which Telenor now stands at 36.572 million total subscribers. Telenor’s EBITDA (Earnings before interest, taxes, depreciation, and amortization) also saw an 11% year-over-year growth, and 19% increase as compared to the Q1 2014. Moreover, a 5.6% year-over-year total revenue growth in first six months of 2014 also indicates sustained growth and profitability. Q2 contributed PKR 25.95 billion in revenues, which compares to PKR 24.57 billion for the same period last year (Q2 2013).

ARPU (Average Revenue per Subscriber per Month) saw a decline of 13% because of growth in relatively lower revenue generating segments, however the drop was partially compensated by increased surcharges and new data/voice bundles. ARPU currently stands at around PKR 190, compared to Q2 2013’s PKR 222.

Moreover, Telenor’s capex (Capital Expenditure) investments amounted to PKR 17 billion, mainly because of the capitalization of 3G license which Telenor purchased for USD 147.5 million earlier this year.

Some of the highlights of Telenor’s second quarter of 2014 were:

• Telenor commercially launched 3G in Pakistan on June 1^st and expanded the coverage footprint from 4 launch cities to a total of 14 by mid-July, the largest in Pakistan so far.
• 3G services, within the first month of commercial launch, contributed 7.6% of internet revenues and 3% of additional subscribers.
• Telenor saw a major 52% year-over-year growth in internet users, which amounted to 7.9 million users by the end of Q2 2014. Internet revenue, as a result, also increased by 31% YoY.
• Financial Services segment (EasyPaisa) contributed 2 percent-points of total revenue in Q2 2014, and continues to gain traction despite the growth and introduction of rival OTC cash services, most notably Warid’s Mobile Paisa service introduced recently.
• Telenor also contributed PKR 10 million to support IDPs of North Waziristan in collaboration with its emergency response partner, Pakistan Red Crescent Society (PRCS).

Despite narrowly missing the target revenue for 2 months (May and June), Telenor’s promising Q2 results indicate that it just might be able to overcome the shortfall and close the year with a significant net positive in earnings.

-Source: Telenor Group’s Official Press Release (PDF)