Magyar Telekom results for the first quarter of 2021

11/05/2021

Magyar Telekom results for the first quarter of 2021

Budapest, May 11, 2021 17:30

Magyar Telekom today reported its consolidated financial results for the first quarter of 2021, in accordance with International Financial Reporting Standards (IFRS) as endorsed by the EU. The quarterly financial report contains unaudited figures for each reporting periods.

Highlights:

Total revenues increased by 1.9% year-on-year to HUF 162.3 billion in Q1 2021 as increases in telecommunication service revenues in both countries of operation compensated for moderately lower System Integration and IT ( SI/IT') sales and the fall-out in Hungarian retail broadband revenues.

Mobile revenues increased by 2.5% year-on-year to HUF 90.4 billion in Q1 2021 , driven by further growth in mobile data revenues which offset lower retail voice revenues.

Fixed line revenues increased by 1.9% year-on-year, to HUF 53.8 billion in Q1 2021 as the continued decline in voice revenues was fully offset by further improvements in TV revenues in both markets.

System Integration (SI) and IT ( SI/IT') revenues were moderately down at HUF 18.1 billion in Q1 2021 , reflecting the combined impact of lower revenues from Hungarian public sector projects which was mostly offset by higher corporate revenues, while revenues from customized solution projects declined year-on-year from an elevated base in North Macedonia.

Direct costs increased by 3.1% year-on-year to HUF 69.2 billion in Q1 2021, mostly driven by higher interconnect and TV content expenses, coupled with some increases in equipment costs.

Interconnect costs increased by 11.1% year-on-year to HUF 5.9 billion in Q1 2021, reflecting the continued increase in off-network mobile voice and SMS traffic, which resulted in higher payments to domestic mobile operators.

SI/IT service-related costs decreased by 3.5% year-on-year to HUF 12.4 billion in Q1 2021, owing to lower volumes of related projects at both operation.

Bad debt expenses decreased by HUF 0.6 billion year-on-year to HUF 2.0 billion in Q1 2021, as the combined impact of favorable aging of mobile receivables in Hungary and the absence of one-off expenses in relation to the COVID-19 pandemic and the release of customers from loyalty periods that impacted Q1 2020 results.

Telecom taxrose by 4.7% year-on-year to HUF 6.8 billion in Q1 2021, driven by increases in mobile voice traffic in the business and residential segments, as well as higher residential landline usage in Hungary.

Other direct costs were up 5.7% year-on-year to HUF 42.0 billion in Q1 2021, driven by higher equipment costs coupled with an increase in the Hungarian TV content outpayments, and some one-off additional costs that emerged in relation to the lockdowns in relation to the third wave of in Hungary.

Gross profit improved by 1.0% year-on-year to HUF 93.1 billion in Q1 2021, thanks to a higher contribution from telecommunication services, which was partly offset by one-off costs in relation to the third wave of the pandemic in Hungary.

Indirect costs improved by 6.3% year-on-year, to HUF 42.9 billion in Q1 2021, primarily reflecting the lower level of severance expenses, Group-wide.

Employee-related expenses were down by HUF 2.9 billion year-on-year, amounting to HUF 19.2 billion in Q1 2021, attributable to the lower level of severance expenses and the reduction in the average headcount, which was partly counterbalanced by the general wage increase introduced in Hungary in July 2020.

Utility tax was marginally higher year-on-year, amounting to HUF 7.3 billion in Q1 2021, reflecting the combined impact of an increase in the length of the taxable network (mostly due to expiring tax credits from network investments in 2015), offset by the positive effect of the tax credit relating to Magyar Telekom's new network investments and upgrades that enable internet access of at least 100 Mbps.

Other operating expenses (without utility tax) increased by 2.9% year-on-year to HUF 17.3 billion for the quarter, as the positive contribution of cost optimization measures was somewhat offset by the FX impact on North Macedonian expenses due to the weakening of the forint against the denar as well as increase in network operation related expenses and provisions related to legal cases at the Hungarian operation.

Other operating income was up at HUF 0.8 billion in Q1 2021, primarily driven by income related to real estate sales in Hungary.

EBITDA rose by 8.2% year-on-year to HUF 50.2 billion, with EBITDA AL improving by 8.1% year-on-year to HUF 44.2 billion in Q1 2021, driven by the improvement in gross profit and lower employee related expenses.

Depreciation and amortization ( D&A') expenses rose by 4.3% year-on-year to HUF 35.1 billion in Q1 2021, attributable to the frequency licenses acquired in March 2020 in Hungary, while in North Macedonia the increase reflected higher amortization expenses in relation to content rights, software and licenses.

Profit for the period rose by HUF 10.9 billion year-on-year to HUF 10.1 billion in Q1 2021 , reflecting higher EBITDA, coupled with better financial results. .

Net financial result improved considerably year-on-year, from a loss of HUF 11.0 billion to a loss of HUF 1.6 billion in the quarter. This year-on-year change was mainly attributable to the absence of negative FX impacts due to the significant weakening of the forint against the euro during the base period in 2020, coupled with the positive effect of movements in the yield curve that led to unrealized gains on the recognition of derivatives at fair value in Q1 2021. These impacts fully offset the moderate increase in interest costs that mostly reflects the higher interest expenses in relation to lease and frequency usage rights liabilities.

Income tax expensesincreased from HUF 2.5 billion in Q1 2020 to HU

LINK:	https://www.telekom.hu/about_us/press_room/press_releases/2021/may_11...
	See more stories from telekom

Most recent headlines

05/01/2027

Worlds first 802.15.4ab-UWB chip verified by Calterah and Rohde & Schwarz to be demoed at CES 2026

Worlds first 802.15.4ab-UWB chip verified by Calterah and Rohde & Schwarz to be ...

01/06/2026

Dolby Sets the New Standard for Premium Entertainment at CES 2026

January 6 2026, 05:30 (PST) Dolby Sets the New Standard for Premium Entertainment at CES 2026 Throughout the week, Dolby brings to life the latest innovatio...

02/05/2026

Dalet Flex LTS Delivers Smarter Search, Faster Editing, and an AI-Ready Foundation for Modern Media

Dalet, a leading technology and service provider for media-rich organizations, t...

01/05/2026

NBCUniversal's Peacock to Be First Streamer to Integrate Dolby's Full Suite of Premium Picture and Sound Innovations

January 5 2026, 18:30 (PST) NBCUniversal's Peacock to Be First Streamer to ...

01/04/2026

DOLBY AND DOUYIN EMPOWER THE NEXT GENERATON OF CREATORS WITH DOLBY VISION

January 4 2026, 18:00 (PST) DOLBY AND DOUYIN EMPOWER THE NEXT GENERATON OF CREATORS WITH DOLBY VISION Douyin Users Can Now Create And Share Videos With Stun...

18/03/2026

Net Insight Names Larissa GrnerMeeus CPO

Newly named chief product officer (CPO), Larissa G rner Meeus will return to Net Insight on May 4. Larissa G rner Meeus will become CPO of Net Insight on May 4...

18/03/2026

SVG Europe's The Football Summit 2026: Select Sessions Now Available to Watch on SVG PLAY

SVG Europe's The Football Summit 2026 explored how the sports broadcasting i...

18/03/2026

SVG's SportsTech@NABShow Blog Goes Live as Countdown to Vegas Heats Up

The 2026 NAB Show kicks off one month from today and SVG is once again set to cover the show from every angle. SVG's SportsTech@NAB Show Blog is now live - ...

18/03/2026

The Premiere of Dead Lover Showcases Grave Robbing and Sex With a Giant Finger

(L-R) The cast and crew of Dead Lover at The Ray Theater for its premiere at the 2025 Sundance Film Festival. (Photo by Robin Marshall/Shutterstock for Sundan...

18/03/2026

Music Row Piano from Wiltone Productions

Yamaha C7 captured in Nashville Wiltone Productions have announced the release of Music Row Piano, a deeply sampled Yamaha C7 piano library that's been ...

18/03/2026

Techivation introduce T-Warmer Mk2

Bass-enhancement plug-in upgraded Along with a steady stream of new releases, Techivation have recently been revisiting some of the older plug-ins in their ...

18/03/2026

Tonal Balance Control 3 from iZotope

Mix-reference plug-in overhauled iZotope's powerful mix-referencing plug-in has just reached its third major version, and now boasts a new capture proce...

18/03/2026

Toontrack Transistor Organ EKX

Latest EZKeys 2 expansion arrives Toontrack's staggering collection of EZKeys 2 expansions has grown once again, and the latest instalment delivers a on...

18/03/2026

Jess Ho explores the politics of food in new SBS Audio podcast For The Culture

Jess Ho explores the politics of food in new SBS Audio podcast For The Culture 18 March, 2026 Media releases New SBS Audio podcast For The Culture, hosted ...

18/03/2026

Future-ready broadcasts with ATSC 3.0 and enhanced services from Rohde & Schwarz at NAB 2026

Future-ready broadcasts with ATSC 3.0 and enhanced services from Rohde & Schwarz...

18/03/2026

LCTWS 2026

London Calling - When The Industry Convened to Help Streaming Find its MoJo In this blog, Laura Rognoni reflects on key discussions from the Connected TV World...

18/03/2026

SMPTE Unveils 2026 NAB Show Educational Presentations

SMPTE Unveils 2026 NAB Show Educational Presentations Brie Clayton March 18, 2026 0 Comments SMPTE , the home of media professionals, technologists, a...

18/03/2026

Auditel Ad Campaign Shot on Blackmagic PYXIS 12K

Auditel Ad Campaign Shot on Blackmagic PYXIS 12K Brie Clayton March 18, 2026 0 Comments LED wall virtual production blends 12K open gate acquisition w...

18/03/2026