A1 Hrvatska Had Stable Growth in Q1 2019

A1 Hrvatska Had Stable Growth in Q1 2019
Dražen Tomić - Tomich Productions

A1 Hrvatska showed positive results of key business indicators in Q1 2019 as revenue grew by 2.6 percent to EUR 102,1 million. In total, revenues in the Croatian segment rose by 2.6% year-on-year mainly driven by higher service revenues and EBITDA increased by 6.3 percent to EUR 31,7 million.

Investments totaled EUR 24,7 million representing a 79.7 percent increase. The strong growth in investment is the result of network investments in frequencies and technologies. Regulatory-driven frequency fee reduction allowed further investments in development and network capacity.

The market continued to be shaped by convergent solutions with highly discounted offers. High demand for mobile WiFi routers in the mobile business and TV content in the fixed-line business remained the main drivers of the market growth. Costs and expenses were only slightly higher as higher market investments reflected in content, equipment, and commissions, were almost fully offset by lower frequency usage fees due to the November 2018 cut.

Continuation of the high demand for mobile WiFi routers (Homebox service), the ongoing shift from prepaid to postpaid subscribers and successful promotional activities were main drivers of mobile revenues increase driving to contract subscriber base growth of 8.5 percent compared to the same time last year. The average revenue per user decreased by 0.9 percent amounting to EUR 9.9, reflecting higher promotional activities and discounts.

A1 Hrvatska continues with the organic growth of the fixed segment. Strong demand for TV solutions increased the fixed subscriber base driven by fixed-line revenues growth. In total services (RGU) increased 6.0 percent, broadband 3.1 percent, and TV services 10.2 percent. Several fixed users was almost 695.000 by the end of Q1. This was mostly contributed by the investment in the content like UEFA Champions League and new exclusive programs like BBC First, one of the best drama channels fully subtitled in Croatian. ARPL in the Q1 is 1.4 percent higher, amounting to EUR 30,5.

“A1 Hrvatska is maintaining strong operational performance, and we are showing organic growth in key market categories. Our convergent strategy is showing strong performance as well as postpaid mobile service and especially continued the strong growth of mobile broadband category driven by Homebox service. Furthermore, higher capital expenditures were driven by the acquisition of frequencies in the 2,100 MHz band in Croatia. This will bring additional benefits to our customers and shows readiness to reinvest funds retained due to parafiscal taxes reduction. In the following months we will continue with strong investments in network infrastructure and services quality as a reliable partner both for our customers and the Croatian economy and society in the digital era“, said Jiří Dvorjančanský, A1 Hrvatska CEO to ICTbusiness.info inquiry.