Dutch telecoms KPN sees profits dip, blames apps
Dutch telecoms operator KPN said Tuesday its net profit dipped by 9.4 percent for the third quarter, due to Internet-based applications, but stressed it stayed on course to achieve 2011 targets.
The company raked in 368 million euros (U$512 million) in net profit, less than predicted by analysts on Dow Jones Newsires, who expected a figure of 429.2 million euros.
Third quarter sales were also down year-on-year by 3.4 percent to 3.26 billion euros from 3.37 billion euros in the same period last year, mainly because users are switching to Internet-based phone applications such as Skype or opting for text messages.
The Hague-based company has raised the possibility of charging customers to use online communication applications such as Skype and WhatsApp, but the Dutch parliament in June adopted a law ensuring "Net neutrality" disallowing KPN and other providers to implement this idea.
KPN, which employs around 30,000 people therefore decided to increase Internet access rates for mobile phones. Announced on June 19, the increase became effective in September.
Despite earnings before interest and tax, or EBITDA, down by 12 percent to 1.25 billion euros year-on-year, KPN "remained on track to realise its outlook for the rest of the year", its chief executive Eelco Blok said, with EBITDA greater than 5.3 billion euros expected.
© 2011 AFP