April 21, 2015 / 6:06 AM / 4 years ago

UPDATE 1-TeliaSonera Q1 profit matches forecasts as Eurasia unit returns to growth

* Repeats 2015 outlook

* Q1 sales in Eurasia region grew after decline in Q4

* Q1 EBITDA in line with expectations (Adds details, background)

STOCKHOLM, April 21 (Reuters) - Swedish telecom operator TeliaSonera repeated its outlook of flat earnings this year on Tuesday as its Eurasia unit returned to growth and it posted first-quarter core profit largely in line with market expectations.

TeliaSonera’s Eurasia unit, which comprises Kazakhstan, Azerbaijan, Uzbekistan, Tajikistan, Georgia, Moldova and Nepal, has long been a growth engine for Sweden’s largest carrier and accounted for 20 percent of group sales last year.

But sales in the region dropped for the first time in the fourth quarter as a deteriorating Russian economy weighed. Many of those countries are heavily dependent on Russia for trade, investments and remittances.

In the first quarter, organic service revenues in Eurasia grew by 1.4 percent, after a 2.4 percent decline in the fourth quarter.

“The macroeconomic and competitive picture in parts of Eurasia remained demanding and we have put a lot of effort into re-positioning our offerings in order to make us more attractive for the customers,” chief executive Johan Dennelind said in a statement.

The company’s earnings before interest, tax, depreciation and amortisation (EBITDA), excluding non-recurring items, were 8.54 billion Swedish crowns ($981 million) versus the average forecast of 8.58 billion in a Reuters poll of analysts and 8.35 in the year-ago period.

Telia repeated it expected 2015 EBITDA earnings to be around the same level as in 2014 on a like-for-like basis, excluding non-recurring items.

“As expected, the start of the year has been somewhat slow, but we foresee a gradual improvement in the earnings trend and reiterate our full year outlook,” Dennelind said.

$1 = 8.7097 Swedish crowns Reporting by Olof Swahnberg; Editing by Sven Nordenstam and Sunil Nair

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