Telenor sees higher EBITDA margin; cuts revenue, capex outlook for 2016

Norwegian mobile phone operator Telenor lifted ambitions for its EBITDA margin this year despite a cut in expectations for 2016 revenue, as it reported second-quarter core earnings above forecast on Tuesday.

Adjusted quarterly earnings before interest, taxes, depreciation and amortisation (EBITDA) rose 8 percent to 11.55 billion Norwegian crowns ($1.37 billion), above expectations of 11.15 billion crowns in a Reuters poll of analysts.

Telenor, which has more than 200 million subscribers across Europe and Asia, said it now expected an EBITDA margin of around 35 percent compared with a previous estimate of 33-34 percent.

It said full-year revenue was expected to grow by 1-2 percent, down from a previous view of 2-4 percent.

Capital expenditure this year was now seen at 17 percent of revenue excluding licences and spectrum, versus the 17-19 percent earlier.

Telenor said it had decided not to participate in an upcoming spectrum auction in India, “as we believe the proposed spectrum prices do not give an acceptable level of return”.

The company said previously it might leave India unless it was able to secure additional capacity for its networks at a reasonable cost.