Telefonica Deutschland Posts Loss, But Revenues Up; Sees OIBDA Growth; Stock Up

(RTTNews) - Shares of Telefonica Deutschland Holding AG (TELDF.OB, TFTHF.OB) were gaining around 6 percent in the morning trading in German after the Spanish telecom group Telefónica S.A.'s (TEF, TDE.L) German unit reported Tuesday strong growth in revenues and access base in the year 2014, despite reporting a loss. Looking ahead, for fiscal 2015, the company projects growth in OIBDA, a key earnings metric.

For the year, the company's loss was 721 million euros, compared to last year's profit of 78 million euros. Operating loss was 646 million euros, compared to profit of 105 million euros last year.

Operating Income before Depreciation and Amortisation or OIBDA for 2014 amounted to 679 million euros, down 45.1 percent from last year. OIBDA was 1.46 billion euros on an underlying, combined basis. OIBDA margin was 12.3 percent, down from 25.2 percent last year, and underlying OIBDA margin was 18.7 percent.

Revenue for the year totaled 5.52 billion euros, consolidating E-Plus Group with effect of 1 October 2014, 12.4 percent higher than last year's 4.91 billion euros. On a combined basis, 2014 revenues would have been 7.79 billion euros.

In the fourth quarter, revenue reached 2.019 billion euros, 62.4 percent higher than last year, but was largely stable year-on-year on a like-for-like basis. Mobile service revenues were 1.39 billion euros, same as last year on a like-for-like basis.

At the end of the year, the company's access base reached 47.66 million, an increase of 89.4 percent on a reported basis and 1.6 percent on a like for-like basis.

Looking ahead, for fiscal 2015, the company expects revenue and other synergies to come from cross and up-selling activities, the increase of market share in the SME segment and the initial contribution from the Mobile Bitstream Access agreement to wholesale business.

The company expects mobile service revenue in 2015 to remain broadly stable over 2014 combined figure of 5.528 billion euros.

The company also projects a gradual progression of improvement in OIBDA throughout 2015 driven by the capture of synergies from the integration of organisations and initial projects for the combination of networks.

OIBDA is expected to grow more than 10 percent year-on-year in 2015 from a 2014 combined base of 1.46 billion euros.

With regards to shareholder remuneration, the company intends to suggest to the general shareholders' meeting a cash dividend of at least 700 million euros for the year 2014, payable in May 2015. The company also expects CapEx to show a high single digit percentage decline.

Telefonica Deutschland shares were gaining 6.01 percent to trade at 5.04 euros.