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3 years ago
Croatia's T-HT Q1 revenues down, new govt fee to push up prices
April 30, 2014 / 8:41 AM / 3 years ago

Croatia's T-HT Q1 revenues down, new govt fee to push up prices

3 Min Read

* First quarter revenues down 6.2 percent

* T-HT may raise prices for mobile services

* Eyeing expansion in the Balkan region

ZAGREB, April 30 (Reuters) - Croatia's leading telecom operator T-HT reported lower revenues and first-quarter net profit on Wednesday, citing the protracted economic crisis in the country and a regulatory realignment after it became the European Union's newest member.

T-HT's net profit was 16.5 percent below the same period last year, amounting to 199 million kuna ($36.15 million), while revenues fell 6.2 percent to 1.6 billion kuna.

"The economic crisis and regulatory changes, primarily in the area of roaming and call termination, continue to have a strong impact on the company's performance. The results in the first quarter are in line with our business plans," T-HT's CEO Davor Tomaskovic said in a statement.

He said that T-HT, majority-owned by Deutsche Telekom , was reorganising its internal structure to make the company more flexible and efficient.

T-HT said it may raise the prices of its mobile services following the government's recent announcement that it plans to hike annual frequency fees to help shore up the budget.

"To mitigate the negative impact of such a considerable cost increase and insure business sustainability, jobs and investments in development, T-HT has no other option but to include such an increase into prices for mobile services," Tomaskovic said.

The Zagreb government is under pressure from Brussels to reduce its wide budget gap. The government has so far focused more on boosting revenues than on measures to make the public administration cheaper and more efficient.

Croatia, which joined the EU last July, has suffered five straight years of recession, and for this year most analysts and the central bank expect another year of mild contraction.

Tomaskovic said T-HT would continue eyeing potential opportunities for regional expansion.

T-HT has over 1.2 million fixed-line customers and almost 2.3 million mobile subscribers in a country of 4.4 million people. Its main competitors are Vipnet, owned by Telekom Austria, and Sweden's Tele2. ($1 = 5.5053 Croatian Kunas) (Reporting by Igor Ilic; editing by Zoran Radosavljevic and Hugh Lawson)

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