PURPOSE-DRIVEN START TO THE YEAR AT MAGYAR TELEKOM - MAGYAR TELEKOM RESULTS FOR THE FIRST QUARTER OF 2025

PURPOSE-DRIVEN START TO THE YEAR AT MAGYAR TELEKOM - MAGYAR TELEKOM RESULTS FOR THE FIRST QUARTER OF 2025

Budapest, May 14, 2025 08:02

Magyar Telekom began 2025 in line with its stated objectives and according to schedule. The Group's revenue increased by 7.8% year-on-year, reaching 241.6 billion HUF in the first quarter, primarily driven by the growing demand from customers for data and connectivity. To continue meeting this increasing demand at the highest level, the company continued to work consistently on the previously initiated development of its network and systems during the quarter. In the first three months of the year, it expanded its gigabit-capable network with an additional 58 thousand new access points and started the monetization phase of its renewed CRM system. These steps c ontribute to the countrys digitalization and further enhance Telekom's flexibility and resilience. In the financial report for the first quarter released today, the company reiterated its previously set strategic direction and full-year guidance for 2025.

Magyar Telekom today reported its consolidated financial results for the first quarter of 2025, in accordance with International Financial Reporting Standards (IFRS) as endorsed by the EU. The quarterly financial report contains unaudited figures.

Highlights:

Total revenue increased by 7.8% year-on-year to HUF 241.6 billion in Q1 2025 , which was attributable to the continued strong demand for mobile data and fixed broadband services, higher SI/IT revenue and the positive impact of the inflation-based fee adjustment implemented in March 2024, in Hungary.

Mobile revenue rose by 7.4% year-on-year to HUF 140.6 billion in Q1 2025 , driven by the continued growth in mobile data usage as well as the favorable impacts of the inflation-based fee adjustment.

Fixed line revenue increased by 7.6% year-on-year, to HUF 78.1 billion in Q1 2025, reflecting the increases in fixed broadband driven by the customer base expansions as well as the favorable impact of the inflation-based fee adjustment in the first two months.

System Integration and IT revenue rose by 10.9% year-on-year, amounting to HUF 23.0 billion in Q1 2025 , thanks to higher revenue from major projects at the Hungarian operation.

Direct costs increased by 3.2% year-on-year to HUF 91.6 billion in Q1 2025, reflecting the higher SI/IT related costs and the increase in other expenses.

Interconnect costs increased by 8.0% YoY to HUF 4.7 billion in Q1 2025, reflecting primarily higher outpayments to mobile operators in both countries of operation.

SI/IT service-related costs were up by 12.7% YoY, amounting to HUF 17.0 billion in Q1 2025, in line with the year-on-year higher project volumes.

Impairment losses and gains on financial assets and contract assets (bad debt expenses) declined by 10.1% YoY to HUF 3.1 billion in Q1 2025, thanks to more favorable aging of the receivables compared to the base period.

Telecom tax declined by 3.4% year-on-year, amounting to HUF 6.1 billion in Q1 2025, reflecting primarily the lower mobile voice traffic generated by business customers, in line with the decline in this subscriber base.

Other direct costs were up by 1.9% year-on-year at HUF 60.8 billion in Q1 2025, primarily driven by higher TV content fees and some moderate increase in non-voice service-related expenses as well as roaming outpayments.

Gross profit improved by 10.7% year-on-year to HUF 150.0 billion in Q1 2025, thanks to improvement in service revenue.

Indirect costs were lower by 12.0% or HUF 6.1 billion year-on-year, at HUF 44.8 billion in Q1 2025, as the positive impact from the phase-out of the supplementary telecommunication tax more than offset the increase in employee-related expenses.

Employee-related expenses increased by 14.7% year-on-year, amounting to HUF 25.0 billion in Q1 2025, as a result of the wage increases in effect from May 1, 2024 and March 1, 2025 at the Hungarian operation.

Supplementary telecommunication tax was eliminated effective from January 1, 2025, resulting in a HUF 8.9 billion improvement year-on-year.

Other operating expenses (excluding supplementary telecommunication tax) decreased moderately year-on-year, amounting to HUF 20.9 billion in Q1 2025, as the reduction in energy expenses coupled with the positive impacts stemming from efficiency measures could compensate for the inflationary price pressure impacting several cost lines.

Other operating income amounted to HUF 1.1 billion in Q1 2025.

EBITDA increased by 24.4% year-on-year to HUF 105.2 billion in Q1 2025, driven by the improvement in gross profit coupled with lower indirect costs; EBITDA AL was up by 26.7% year-on-year to HUF 97.5 billion in Q1 2025.

Depreciation and amortization ( D&A') expenses remained on the same level year-on-year, amounting to HUF 35.3 billion in Q1 2025.

Profit for the period rose by 59.0% year-on-year to HUF 55.7 billion in Q1 2025, driven primarily by the growth in EBITDA.

Net financial result improved from a loss of HUF 7.8 billion in Q1 2024 to a loss of HUF 5.2 billion in Q1 2025. Year-on-year lower net interest expense was primarily attributable to a reduction in the overall debt levels, lower average interest rates as well as higher interest received related to the liquidity balances. The favorable change in other finance expense year-on-year primarily reflects the more favorable FX change-related results driven by the moderate strengthening of the forint during Q1 2025 vs. weakening during Q1 2024.

Income tax expenses were up by 39.3% year-on-year at HUF 9.1 billion in Q1 2025, driven by the year-on-year higher profit levels.

Profit attributable to non-controlling interests increased by 12.4% year-on-year to HUF 1.5 billion in Q1 2025, reflecting YoY higher profit generation at the North Macedonian subsidiary.

LINK:	https://www.telekom.hu/about_us/press_room/press_releases/2025/may_14...
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