Mobile phone operator Telenor missed fourth quarter profit estimates and expects margins to fall this year amid intense competition in Thailand and as it ramps up spending in Myanmar, sending its shares seven percent lower. In past years Norway's Telenor has outperformed European peers because of its exposure to faster growing markets in Asia, including Indian and Bangladeshi units which also disappointed in the fourth quarter.
Telenor, which has over 180 million subscribers across Europe and Asia, is building a network from scratch in Myanmar and struggling in Thailand where costs are up and margins on handset sales are negative, the firm said. "We are not satisfied with the present results in Thailand," Chief Executive Jon Fredrik Baksaas said. "The past few quarters (Thai unit) dtac has not been able to increase data revenues sufficiently."
In 2015, Telenor expects revenue to grow by "mid-single digits" and its earnings before interest, taxes, depreciation and amortisation (EBITDA) margin to fall to between 33 percent to 35 percent from last year's 35.4 percent. Its fourth quarter EBITDA rose 4 percent to 9.09 billion crowns ($1.20 billion), missing expectations for 9.72 billion crowns, as units in Thailand, India and Sweden missed forecasts.
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