Related News:
Hrvatski Telekom Says First-Half Net Income Dropped 24.7% to $184 Million
T-Hrvatski Telekom d.d. said net income in the first half of the year fell 24.7 percent to 822 million kuna as the recession and a special tax on mobile services cut into earnings.
Group revenue was down 3.9 percent at 4.04 billion kuna, a sign that the “rate of revenue decline” is easing following last year’s 5.8 percent economic slump and the imposition of a 6 percent levy on mobile-phone usage, the Croatian Unit of Deutsche Telekom AG said in a Regulatory News Service filing today in Zagreb.
“T-HT has reported a commendable set of results, given the challenges we faced,” Chief Executive Officer Ivica Mudrinic said in the statement. “Our efforts to mitigate the effects of the recession helped to slow the revenue decline in the second quarter and we remain focused on retaining and gaining customers while at the same time reducing costs.”
Croatia’s telecommunications industry suffered as the worst recession since the Balkan wars in the 1990s led to cutbacks in consumer spending and and the economic contraction last year. The Croatian central bank expects the economy to recover by the end of the year as demand in Europe improves.
Revenue in its mobile unit declined 9.8 percent from the same period last year, with prepaid business suffering. At the same time, Internet growth was strong, with revenue from the business rising by 20.4 percent to 688 million kuna, it said.
The government introduced the mobile phone levy along with other tax increases to bolster budget revenue. Earlier this year, the company said its earnings may improve in the second part of the year as the government scraps the tax.
“We welcome the decision to cancel the Special Tax on Salary, Pensions and Other Income and urge the Government to abandon the Special Tax on Mobile Services in the interests of renewed investment in Croatia that will improve the economic climate for the entire country,” Mudrinic said.
To contact the reporter on this story: Gordana Filipovic in Belgrade at gfilipovic@bloomberg.net
Rate These Stories
Rate this Page