BRUSSELS, April 24 (Reuters) - Belgian mobile phone operator Mobistar said on Thursday that prices should begin to stabilise after first quarter core profit dropped by more than a third on lost customers and remaining clients spending less.
The group’s profits have been under severe pressure for the past years due regulatory caps on charges and a high level of competition sparked by new Belgian rules limiting the maximum duration of a contract to six months.
Mobistar has also been penalised by the fact that, unlike competitors Belgacom and Telenet, it does not have its own fixed line network, making it unable to respond to a trend where mobile phone services are sold jointly with home broadband and digital TV.
The group, majority owned by France’s Orange, lost 79,000 customers from the fourth quarter of 2013 and the remaining users spent less on their monthly bill, 23.4 euros from and average of 24.0 euros in the previous quarter.
Mobistar added, however, that it noticed an improving trend over the first three months of the year, keeping its full year outlook for a core profit between 250 and 280 million euros ($345.7-$387.2 million), from 336 million euros in 2013.
“The market repricing should also start losing its intensity,” Chief Financial Officer Ludovic Pech said in a statement.
Core profit fell 34.6 percent in the first quarter to 64.5 million euros, just above the 62.5 million expected in a Reuters poll of five analysts. ($1 = 0.7231 Euros) (Reporting by Robert-Jan Bartunek; editing by Philip Blenkinsop)