Telenor affirms 2009 targets, eyes dividends

Telenor affirms 2009 targets, eyes dividends
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First Published: Tue, Sep 15 2009. 02 37 PM IST
Updated: Tue, Sep 15 2009. 02 37 PM IST
Oslo: Norwegian telecom company Telenor kept its main targets for 2009, and said it would seek to resume paying dividends from the 2010 financial year and that price pressure continued on its mobile markets.
Telenor, which has operations in 13 countries in Europe and Asia, affirmed on Tuesday its 2009 guidance for an EBITDA margin of around 34% and steady 2009 revenues compared to 2008.
Its shares were up 0.2% at 62.65 crowns by 0718 GMT while the DJ Stoxx Telecom Index was up 0.3%.
Telenor said its medium-term ambitions were “to keep or improve revenues, boost cash flow margins and deliver according to plan” its India roll-out, in presentation material for its Capital Markets Day.
“The financial crisis has led to change—the focus on operational performance has become much more important in our industry ... so we can be ready when things start moving again,” chief executive Jon Fredrik Baksaas told investors and reporters in Telenor’s headquarters on the outskirts of Oslo.
Telenor said market trends impacting its business pointed to “growth in voice but at a slower pace, growing demand for mobile data access and services (and) continued price pressure”.
In India, its latest venture whose large cost forced Telenor to stop paying dividends, the Norwegian company repeated that it expected an EBITDA breakeven about three years after launch and operating cash flow breakeven five years after launch. Telenor expects to begin offering mobile services in India in late 2009.
Telenor said it aimed to resume its dividend policy from financial year 2010, distributing some 40-60% of normalised net income and aiming for nominal increases in payouts. It saw little room for share buybacks in the mid-term.
Telenor said its next court case in Russia was on 30 September, when its appeal hearing of the Farimex case will be heard.
Telenor lost another round of its Russian legal battle against tiny Vimpelcom investor Farimex in August, when a Moscow appeals court rejected its latest attempt to delay the enforcement of a $1.7 billion Siberian court fine levied on the Norwegian company for allegedly blocking Vimpelcom’s expansion.
The company faces the prospect of losing its stake in Vimpelcom after Russian bailiffs in June ordered the sale of its shares to cover the fine.
The case is being watched as a sign of how foreign investors are treated in Russia.
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First Published: Tue, Sep 15 2009. 02 37 PM IST