RomTelecom Q1 net income, 18.7m euros

Fixed telephony and data operator RomTelecom announced net income of 18.7 million euros for the first quarter of this year, up 43.5% from the same time in 2005. Revenues, however, were down 2.3% to 222.8 million euros. The number of fixed telephony subscribers also dropped, by 10.4% to 3.8 million compared with the same period of last year. The operator says that the revenue decline was generated by the decline in the number of subscriptions and in sales. Under the circumstances, the growth of profit was made possible by a drastic cut in expenditures, by rebalancing tariffs in February last year, and by focusing on data services for residential and business customers. Personnel expenses fell by 43.1% to 50.09 million euros in the first quarter, partly as a result of the reduction in the volume of payments pertaining to voluntary retirement schemes. Moreover, RomTelecom cut its employees” salaries by 5%. At the end of March, RomTelecom had 13,039 employees, 15.2% fewer than in the corresponding period of last year. According to OTE, which controls 54.01% in RomTelecom, the personnel spending cuts in Romania made a significant impact group-wide, too. Revenues from subscriptions rose by 9.2% in the first three months compared with the same time in 2005, to 68.38 million euros, and those derived from services other than the voice services went up by 15.9% to 38.04 million euros. ZF