DNA Ltd Interim Report January-March 2014. DNA’s net sales and EBITDA increased in the first quarter

DNA’s net sales and EBITDA increased in the first quarter

Summary

Unless otherwise stated, the comparison figures in brackets refer to the corresponding period in the previous year (reference period).

January-March 2014

• Net sales increased by 6.6 per cent and came to EUR 198.2 million (186.0 million).
• EBITDA increased by 1.3 per cent to EUR 48.4 million (47.7 million), accounting for 24.4 per cent of net sales (25.7 per cent).
• EBITDA excluding non-recurring items came to EUR 48.4 million (48.1 million).
• Operating profit decreased by 4.2 per cent to EUR 11.7 million (12.2 million), or 5.9 per cent of net sales (6.6 per cent).
• Operating profit excluding non-recurring items came to EUR 11.7 million (12.6 million).
• The mobile communication subscription base grew by 1.9 per cent, reaching 2,458,000 in total (2,412,000).
  • Revenue per user (ARPU) for mobile communications amounted to EUR 17.8 (18.2).
  • Mobile communication subscription turnover rate (CHURN) was 17.6 per cent (19.3 per cent).
• Fixed-network subscription base (voice, broadband and cable television) came to 1,026,000 subscriptions at the end of the first quarter (1,017,000). The positive development is due to an increase in the number of broadband subscriptions.

DNA’s outlook for 2014 remains unchanged

Net sales and operating profit are expected to increase somewhat in 2014. The Group’s financial position is expected to remain at the same healthy level.

Key figures

Figures are unaudited.

* rolling 12 months

** includes business combinations and business transfers

*** There were no non-recurring items during the review period. In the reference period, they amounted to EUR 0.4 million. 

CEO’s review

Our net sales for the first quarter increased slightly year-on-year and came to EUR 198.2 million. This increase was fuelled in particular by the significant growth in pay-TV business as well as the positive development of mobile and fixed-network broadband sales. Our EBITDA increased and came to EUR 48.4 million while our operating profit decreased slightly and came to EUR 11.7 million.

Our financial position remained good, and net gearing came to 62.2 per cent at the end of the review period. Investments in the first quarter amounted to a total of EUR 20.1 million.

DNA's mobile communications subscription base grew by 8,000 subscriptions during the first quarter and came to 2,458,000. Fixed-network subscription base increased by 10,000, totalling 1,026,000 subscriptions at the end of the first quarter. The positive development is due to an increase in the number of broadband subscriptions.

TV and broadband services provided by one company, DNA Welho Oy

On 1 March 2014, as part of the development of our entertainment services, we combined the television and fixed-network broadband business operations of PlusTV and DNA Welho into one company. At the same time, DigiTV Plus Oy was renamed as DNA Welho Oy.

In March, we strengthened our position as a leading service provider in the cable and terrestrial networks by launching a new entertainment service package. DNA Welho Viihde enables consumers to use entertainment services regardless of time, place and terminal device. It represents a significant step towards more flexible use of TV and other entertainment services.

The steps taken in the first quarter support our strategic objective of establishing the best entertainment service package in Finland.

New partnerships

The Expert home electronics store chain started selling DNA’s entertainment and mobile communications services in early January 2014. The Expert chain nicely complements the existing network of DNA Stores and retailers. During the first quarter, we also launched cooperation with the music service Deezer. This cooperation further strengthens our versatile service offering.

Focus areas in 2014 include corporate business and network development

Corporate business is an important focus area in the further development of DNA’s business. The demand for services related to network data security and management as well as mobility-related data solutions continued to increase in the first quarter. On 4 March 2014, DNA appointed Hannu Rokka, previously CEO of Forte Netservices Oy and Director, Product Management at DNA, as Vice President, Corporate Business.  

The use of high-speed, wireless LTE networks has increased tenfold in less than a year. The use of laptops, smart phones and tablets is becoming more widespread and versatile, in both personal and professional use. The construction of our nationwide 4G LTE network operating at 800 Mhz frequency got underway with Ericsson in early 2014. DNA’s 4G LTE network coverage will double by the end of 2014, reaching 80 per cent of the population. At the same time, we will expand our 3G network so that it reaches approximately 99 per cent of the population by the end of the year.

Signature

Jukka Leinonen

CEO

Additional information:

Jukka Leinonen, CEO, DNA Ltd, tel. +358 44 044 1000, jukka.leinonen (at) dna.fi

Timo Karppinen, CFO, DNA Ltd, tel. +358 44 044 5007, timo.karppinen (at) dna.fi

DNA Corporate Communications, tel. +358 44 044 8000, viestinta (at) dna.fi

Distribution:

Key media

www.dna.fi

DNA Ltd Interim Report January-March 2014