Telenor ramps up investments to support shift to data
By Balazs Koranyi
OSLO (Reuters) - Mobile telecoms firm Telenor expects to accelerate investments in data and digital services this year as customers flock to its higher margin products, it said on Wednesday.
Telenor, which has around 150 million customers in Europe and Asia, will continue to roll out its third generation (3G) service in Thailand and fibre network in Norway to take advantage of "exploding" demand, and could also invest in 3G services elsewhere in Asia and in Denmark.
"The world is going all out on data. There are new digital concepts on every corner. It will be all about data in the future," Chief Executive Jon Fredrik Baksaas told Reuters.
"People are becoming more dependent on data access; I compare it to electricity, people will take it for granted," Baksaas said after the firm published quarterly results and released its initial 2013 guidance.
The transition to data, particularly in Thailand and Norway, the firm's biggest markets, could push capital spending to between 12 and 14 percent of revenues this year from 12 percent in 2012, Baksaas said.
The shift to data, along with smaller losses in India, will allow Telenor to improve margins this year and the firm sees its earnings before interest, taxes, depreciation and amortization (EBITDA) margin widening to 34 percent from 32 percent.
The margin increase and a record 20 billion crown ($3.64 billion) cash flow in 2012 gives Telenor ample cash and it plans to pay a record dividend of 6 crowns per share after the previous year's 5 crowns, it said.