Telenor sees profit drop 61 percent

Telenor Headquarter in Oslo

Telenor Headquarter in Oslo

OSLO – Norwegian telecommunications group Telenor ASA on Thursday reported a 61 percent slump in second-quarter profit, due to sliding revenues and losses in its stake in Russian mobile operator VimpelCom.

Net profit tumbled to 1.38 billion kroner ($220 million) during the quarter, a sharp decline from 3.54 billion kroner in the same period last year. Second-quarter revenues held steady, slipping slightly to 26.9 billion kroner this year from 27.1 billion kroner in 2008.

The group’s shares closed up 1 percent at 53.93 kroner in Oslo.

A strong quarter for Telenor’s Bangladeshi, Norwegian, and Pakistani operations contributed to the sustained revenue stream.

However, the Nordic group sustained heavy losses in the Ukranian market, due both to that country’s ongoing recession and to drops in the value of Ukraine’s currency, Telenor vice president Paal Kvalheim said.

This year’s second-quarter revenues from the group’s Ukranian operation were almost 1 billion kroner lower than they were in the second quarter of 2008.

In addition, a 414 million kroner loss from associated companies, in particular due to write downs of Telenor’s VimpelCom stakes, was especially damaging to the Norwegian concern’s net profits.

Read more on Startribune.com

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