Telenet earnings miss estimates as inflation, lease payments weigh
(Reuters) -Belgian telecoms company Telenet's third-quarter core earnings missed expectations on Thursday, weighed down by the soaring inflation, high energy prices, and tower-related lease payments.
The group reported adjusted earnings before interest, taxes, depreciation and amortisation and after leases (EBITDAal) of 312.7 million euros ($314.9 million) for the three months to Sept. 30, up 1% year-on-year, or 4% on a rebased basis.
This came below analysts' median estimate of 320.7 million euros in a company-compiled poll.
Telenet has been reporting EBITDAal as one of its key metrics since the second quarter of this year to reflect tower-related lease payments following the sale of its mobile tower business to Digital Bridge.
Its revenue came in at 660.5 million euros, above analyst expectations of 652.6 million euros.
The company's operating costs rose by almost 4% in the first nine months of the year, compared with the same period in 2021, driven by mandatory wage indexation, energy costs, the impact of inflation on outsourced labour and professional services, and other indirect expenses such as IT costs.
European inflation has surged in the past year, driven by record gas prices as Russia curbed supplies following its invasion of Ukraine and Western sanctions against Moscow.
Telenet's final agreement with Belgian network operator Fluvius to create an infrastructure joint venture, with an aim to provide speeds of 10 gigabits per second, is pending regulatory approval, CEO John Porter said in a statement.
Telenet reiterated its outlook for 2022.
($1 = 0.9930 euros)
(Reporting by Valentine Baldassari; editing by Milla Nissi)