KPN Q2 Profit Rises; Backs FY20 Adj. EBITDA View - Quick Facts

Dutch telecom firm Royal KPN NV (KKPNY.PK,KPN) reported Monday that its second-quarter net profit increased 5.4 percent to 135 million euros from last year's 128 million euros.

The results mainly reflected lower restructuring costs, 11 million euros book gain on the sale of KPN Consulting and lower finance costs due to debt redemptions.

The company noted that COVID-19 led to a slightly negative impact on KPN's group financial result, mostly in B2B, and offset by ongoing cost measures

Operating profit or EBIT was 233 million euros, up 5.4 percent from last year. Adjusted EBITDA after leases fell 1.5 percent from the prior year to 585 million euros. Adjusted EBITDA margin, however, grew to 45.3 percent from 43.7 percent a year ago.

Adjusted EBITDA after leases was up 0.1 percent excluding divestments.

Adjusted revenues declined 4.9 percent to 1.29 billion euros from 1.36 billion euros last year. Revenue declined 3 percent excluding divestments.

Growth in Professional Services in Business and in Wholesale was offset by lower revenues from mobile (roaming) and fixed voice services.

Further, KPN said it has decided to pay an interim dividend of 4.3 euro cents per share on August 4, 2020. KPN intends to pay a regular dividend per share of 13 euro cents in respect of 2020.

Looking ahead, the company said its 2020 outlook for adjusted EBITDA AL is reiterated.

"A combination of COVID-related downward pressure on revenues, offset by strong cost control enables us to reiterate our 2020 outlook for adjusted EBITDA after leases. Due to COVID- 19 impact we expect B2B end-to-end adjusted EBITDA AL to stabilize during 2021 based on current estimates," the company said.

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