UPDATE 1-Newly-listed Swedish cable operator Com Hem grows core profit in Q2

Tue Jul 15, 2014 4:00am EDT

* Underlying EBITDA 566 mln SEK

* Stands by outlook for mid-single digit sales growth 2014

* CEO: aim is for core growth to replace growth by acquisitions

STOCKHOLM, July 15 (Reuters) - Swedish cable television operator Com Hem posted on Tuesday a 3.5 percent rise in second-quarter core profit and predicted mid-single digit sales growth in 2014.

Com Hem, which was listed in Stockholm on June 17, said profit before interest, tax, depreciation, amortization, writedowns, one-off costs and currency swings rose to 566 million crowns ($83 million) from 547 million a year ago, helped by consumer services sales growth and the acquisition of business-to-business firm Phonera.

Its shares, which at Monday's close were up 13 percent from the initial public offering price, fell 1.5 percent to 64.50 crowns at 0740 GMT.

"We expect the year-on-year revenue growth rate for the financial year 2014 to be in the mid-single digits including the effect of the consolidation of Phonera," Com Hem said.

Phonera, which Com Hem bought in March, accounted for nearly three quarters of sales growth in the quarter.

Com Hem targets mid-single digit sales growth in the next 2-3 years and Chief Executive Anders Nilsson said he aimed for core growth to account for an increasing share of total growth.

"Our ambition is that the non-organic growth be replaced by organic and that we stick to the mid-single digit guidance," he told Reuters.

Com Hem sells broadband, IP telephony and digital television, competing with TeliaSonera and Telenor . It has said it may also consider offering mobile telephony.

"Revenue and underlying EBITDA were somewhat better than we had expected," Alandsbanken analyst Stefan Olsson said but added the report indicated no big growth potential for the firm.

Com Hem's market debut was Sweden's largest initial public offering in 14 years, and was the seventh floatation on the Stockholm bourse's main market after a two-and-a-half-year drought that ended last November.

Link to the Q2-report: here

($1 = 6.7899 Swedish Crowns) (Reporting by Olof Swahnberg, editing by Anna Ringstrom)

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