KPN sees quarterly profit decline despite growth in the number of customers | Financial

The success in those markets that are important to KPN is mainly due to subscriptions for unlimited data consumption. Customers have become accustomed to video calling and other data-guzzling activities after the lockdowns to prevent corona infections. The company is also trying to bring in new customers by offering them free Formula 1 through a deal with streaming service Viaplay. Previously, rival VodafoneZiggo focused strongly on racing fans by letting subscribers watch those races for free via Ziggo.

KPN’s revenues increased by 0.3% in the fourth quarter to €1.4 billion. There was 10% less profit in the books than a year ago. According to KPN, this is mainly because it had to pay more income taxes. KPN’s costs have also increased somewhat. The company had to spend more money to acquire and retain customers. Below the line KPN had €157 million left.

Higher dividend, larger share buyback

The profit was higher than analysts had generally expected. Topman Joost Farwerck also speaks of a “strong financial position”. According to him, this enables KPN to significantly increase the return for shareholders, with which he refers, among other things, to the growth of the dividend. The company has also announced that it will buy back €300 million in its own shares.

KPN still earned less money from roaming in 2021 than before the corona pandemic. This is the fee for using the network when foreigners use mobile internet in the Netherlands. According to financial chief Chris Figee, up to 40% less profit was made from roaming. “It remains to be seen whether this will return soon,” said Figee.

book profit

KPN recorded a turnover of more than €4.8 billion for the whole of 2021, more than 1% less than a year earlier. Profit doubled to €1.3 billion, mainly due to a book profit due to the Glaspoort partnership with pension provider APG.

KPN has recently been focusing on fiber optics. The company aims to have provided about 80% of the Netherlands with fiber optics by 2026. In the past period, 121,000 households were connected. In the whole of 2021 this involved 433,000 homes, more than half a million including Glaspoort.

“KPN expected, cost savings take longer”

This is what DFT reporter Wouter van Bergen thinks:

“KPN performed as expected in the last quarter, but seems to be taking a little longer to achieve the cost savings it has included in its strategic plans. In the last quarter of 2021, it installed fiber at 433,000 households, resulting in 42,000 new fiber subscribers on balance. However, in areas where fiber is not yet available, customers are still dropping out in almost the same numbers, because on balance KPN’s total number of broadband customers was only 3,000 higher than a year earlier.”

Follow Wouter van Bergen on Twitter: @woutervanbergen

—