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Telenor Reports Q4 Profit Despite Revenue Slide

Telenor ASA reports net income of NOK 2.05 billion in Q4, a significant improvement from last year's loss. However, revenue dips highlight challenges ahead as stock prices may react to mixed signals.

Date: 
AI Rating:   6

Financial Highlights
Telenor ASA reports a profit in the fourth quarter, driven by an absence of impairment from the previous year, showcasing a notable recovery.

Net Income
The company achieved a net income of NOK 2.05 billion, an impressive turnaround compared to a loss of NOK 7.41 billion a year ago. The net income attributable to equity holders stood at NOK 1.735 billion, a significant recovery from last year’s loss of NOK 7.683 billion, which had been severely impacted by the NOK 7.20 billion impairment in True Corporation.

Earnings Per Share (EPS)
Telenor's earnings per share were reported at NOK 1.27, improving from a loss per share of NOK 5.55 in the previous year, indicating a strong recovery in profitability.

Profit Margins
The report noted an EBITDA increase to NOK 8.12 billion from NOK 7.99 billion year-on-year, reflecting better operational efficiency despite revenue challenges. The loss in revenue is concerning but is overshadowed by the improvement in profit margins.

Revenue Growth
While the net income was encouraging, revenue experienced a decline to NOK 20.50 billion from NOK 20.93 billion. This slide may concern investors regarding future growth, especially given the projected low single-digit growth rate for Nordic service revenues in 2025.

Outlook
Looking ahead, the company anticipates low-to-mid single-digit organic growth for its EBITDA and modest revenue increases in its Nordic market. This cautious forecast could potentially weigh on investor sentiment moving forward.

Stocks:  TEL.OL