Telekom Austria Group: Full-Year Results 2007 Marked by International Expansion

VIENNA, February 27  /PRNewswire-FirstCall/ -- - Revenues increase by 3.3% from EUR 4,759.6 million to EUR 4,919.0 million driven by both segments 

  - EBITDA declines from EUR 1,911.5 million to EUR 1,854.9 million
  - Competitive Austrian market drives EBITDA decline
  - Growth of international operations compensates start-up loss


- Subscriber base rises by 50.9% to 15.4 million customers, 650.100 subscribers in start-up operations

- Proposed dividend of EUR 0.75 per share

- Revenues expected to grow by approximately 5.0% and EBITDA by approximately 3.0% in 2008

Telekom Austria Group (VSE: TKA, OTC US: TKAGY) today announced its results for the Financial Year 2007 and the fourth quarter ending December 31, 2007.

Year-to-date comparison:

During 2007, revenues increased by 3.3% to EUR 4,919.0 million due to higher revenues from the Mobile Communication and the Fixed Net segment.

EBITDA declined from EUR 1,911.5 million by 3.0% to EUR 1,854.9 million due to a lower contribution from the domestic businesses. EBITDA growth in the inter-national operations in the Mobile Comm-unication segment more than offset cost associated to the launch of operations in the Republic of Serbia and the Republic of Macedonia.

Operating income decreased from EUR 777.1 million to EUR 761.4 million. Net income declined by 12.3% to EUR 492.5 million due to higher interest expenses as a result of the acquisition of MDC in Belarus and higher shareholder remun-eration as well as higher tax expenses.

The year 2006 included a one-off tax benefit in the amount of EUR 43.6 million compared to a one-off tax benefit of EUR 16.6 million in 2007. As a result of the acquisition of treasury shares during 2007 the decline of earnings per share was limited to 8.4% to EUR 1.09.

Capital expenditures for tangible and intangible assets decreased by 14.6% to EUR 851.3 million as 2006 included the acquisition of a licence for the Republic of Serbia for EUR 320.0 million.

Net debt increased by 39.1% to EUR 4,407.2 million at the end of December 2007 mainly due to the acquisition of MDC.

The Management Board will propose a dividend of EUR 0.75 in line with the dividend paid for 2006.

Quarterly comparison:

Revenues increased by 7.4% to EUR 1,288.1 million in 4Q 07 driven by the consolidation of MDC and eTel and the well performing international operations in the Mobile Communication segment.

EBITDA grew by 4.1% to EUR 391.3 million as revenue growth offset higher operating expenses in both segments.

Operating income increased by 20.5% to EUR 93.4 million as a result of higher EBITDA and stable depreciation & amortization.

Net income decreased by 35.2% to EUR 41.0 million during 4Q 07 mainly due to higher interest expenses following the acquisition of MDC and higher shareholder returns in 2007. As a consequence earnings per share decreased by 35.7% to EUR 0.09.

Capital expenditures for tangible and intangible assets decreased by 45.0% to EUR 316.5 as 4Q 06 included the acquisition of a licence for the Republic of Serbia for EUR 320.0 million.

For more detailed information about the full-year results 2007 please refer to the corresponding report on Telekom Austria Group's website at http://www.telekomaustria.com/interim_reports

  Contacts:

  Elisabeth Mattes
  Group Spokeswoman
  Phone: [phone]
  E-Mail: 

  Peter Zydek
  Head of Investor Relations
  Phone: [phone]
  E-Mail: 

DATASOURCE: Telekom Austria Group



CONTACT:  Contacts: Elisabeth Mattes, Group Spokeswoman, Phone:

[phone], E-Mail: ; Peter Zydek, Head of

Investor Relations, Phone: [phone], E-Mail:

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