|TP's profits slumped last year|
Courtesy of TP
Warsaw stock exchange-listed Telekomunikacja Polska (TP) noted a record dive in its share price of some 30 percent to zł.8.10 on Tuesday, February 12.
The drop came after the former telecommunications market monopolist published its financial results for the last quarter of 2012, which showed an 86 percent decrease in profits year-on-year to zł.51 million in 2012 from zł.358 million a year earlier.
The company also announced that the dividend it plans to pay out this year will be significantly lower than last year’s, at only zł.0.50 per share as opposed to the zł.1.50 per share it paid out for 2011.
The firm’s CEO, Maciej Witucki, blamed this unprecedented slump in share price on lower mobile transfer rates (charges one operator pays to another for terminating calls on its network), introduced in December 2012 by Poland’s telecoms regulator, UKE, as well as on price wars with mobile network operators.
Analysts attribute the fall not only to the new regulations but also to the over-employment in the company, as well as to an overall deteriorating situation in the telecommunications market.
According to Mr Witucki, the company will seek to improve its liquidity by selling some of its well-performing assets, such as internet portal Wirtualna Polska, which brought in about zł.180 million in revenue last year.
TP’s stock plummeted despite the news of the company merging with its subsidiary Polska Telefonia Komórkowa Centertel, the operator of the Orange network in Poland.
The merger is to bring all the company’s major assets together and will require significant reductions in staff. The operator is already preparing to lay off 1,700 employees this year and is considering further redundancies in the future.
Until now TP had been considered a defensive stock – a stable investment at times of crisis – as people rarely skimp on communications expenses, even with their incomes significantly undercut by recession.
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