April 19 (Bloomberg) -- TeliaSonera AB, Sweden’s biggest phone company, reported first-quarter profit that missed analysts’ estimates as sales declined in its Nordic markets amid increased competition.
Net income slipped to 4.11 billion kronor ($630 million) from 4.12 billion a year earlier, the Stockholm-based company said today. Analysts predicted 4.32 billion kronor, the average of 15 estimates compiled by Bloomberg. Sales fell 4.4 percent to 24.5 billion kronor, trailing an estimate of 25.1 billion kronor.
TeliaSonera, which made more than 60 percent of its revenue in the Nordic region last year, is battling slowing growth in home markets amid rising competition. The carrier is reducing costs to become more profitable as it focuses more on data revenue than on voice traffic, while growth in its Eurasian unit, with operations in Turkey, Russia and several former Soviet Union countries, continues to bolster earnings.
“In markets like Denmark, Finland, the Baltics, where you see fierce competition on price,” Chief Executive Officer Per-Arne Blomquist said in an interview today. “That’s why we are trying to make sure we get paid for mobile data and we try to fight against having unlimited buckets of data. This is more evident in the Nordic-Baltic markets than Eurasia.”
The first-quarter adjusted margin on earnings before interest, taxes, depreciation and amortization was 34.7 percent. TeliaSonera said that it expects that margin will improve “slightly” in 2013 compared to 2012. Sales will be “flat” excluding currency shifts and acquisitions, the company said.
“The first-quarter earnings were slightly below expectations,” Panu Laitinmaki, an analyst at Danske Markets in Helsinki, said by phone.
Sales from mobile services slipped 2.2 percent in Sweden, its largest market. Revenue from Eurasian markets rose 5.4 percent and the Ebitda margin from that region widened to 53 percent from 50.8 percent a year earlier.
TeliaSonera shares slipped 1.6 percent to 42.71 kronor at 9:22 a.m. local time, erasing yesterday’s 1.2 percent climb. The share is down 3 percent so far this year.
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