Telefónica Deutschland net loss increases in opening 9 months

Telefónica Deutschland bosses shrugged off a rise in its net loss during the nine months to end-September by pointing out the company achieved sustained improvement in its revenue trend during each calendar quarter of the period.

The operator's net loss increased from €1 million ($1.2 million) in the opening nine months of 2013 to €79 million in the recent period, as revenues fell 4.6 per cent to €3.5 billion. Mobile service revenues for the nine months fell 2.4 per cent excluding the impact of mobile termination rate (MTR) cuts, however the figure for the third calendar quarter fell 1.3 per cent year-on-year, compared to a 2.5 per cent decline registered in the second quarter, and a 3.4 per cent drop in the first quarter.

Rachel Empey, Telefónica Deutschland's CFO, said the company's "financial and operational performance in the third quarter demonstrates an improved momentum based on the consistent execution of our mobile data monetization strategy, leveraging the uptake of LTE."

Telefónica Deutschland said the slowdown in revenue declines was mostly driven by growth of non-SMS mobile data revenue, which rose 10.1 per cent year-on-year in the opening nine months.

The operator notes that LTE enabled smartphones accounted for 88 per cent of all smartphones sold in the third calendar quarter. Smartphone penetration at its O2 mobile business hit 74.1 per cent by end-September.

Overall, the operator added 374,000 new post-paid mobile subscribers in the first nine months of 2014, compared to net additions of 207,000 in the comparable period of 2013. Pre-pay mobile net additions for January to September 2014 stood at 70,000.

Third quarter operating income before depreciation and amortisation (OIBDA) excluding special items of €248 million fell short of the average of €251 predicted by analysts in a Reuters poll, the news agency reported.

The nine month figures are the last Telefónica Deutschland will report without including earnings from E-Plus, the former KPN business that Telefónica Deutschland completed an acquisition of in early October.

For more:
- see Telefónica Deutschland's earnings announcement
- view this Reuters report

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