(Bloomberg) -- Telenor ASA slid as much as 4.8% after the biggest phone carrier in the Nordic region cut its full-year outlook as it struggles to expand amid increased competition in key markets.The company’s earnings before interest depreciation and amortization fell 2% to 11.1 billion kroner ($1.3 billion), missing an estimate of 11.3 billion kroner. Revenue was in line with estimates at 28 billion kroner.“Although organic subscription and traffic revenues declined by 1%, the Ebitda margin was 40% and we saw positive revenue development and effects from efficiency and modernization programs,” Chief Executive Officer Sigve Brekke said in a statement. “Our underlying financial performance remains stable.”Telenor is being pressured by slow growth in its mature markets in the Nordic region and competition at its businesses across Asia. The company is in the process of completing a takeover of Finland’s DNA Oyj, to further challenge its Swedish rival Telia Co AB. It’s also in talks with Axiata Group Bhd. to merge operations in Asia, combining their telecom and infrastructure assets to create a company with 300 million customers in nine countries.On Wednesday, the company said it sees subscription and traffic revenue “around the 2018 level,” down from an estimate of a 2% gain. It predicted a “low single digit” decline in Ebitda, compared to an earlier forecast of 1-3% growth. The new outlook takes into account the inclusion of Thailand’s Dtac, an “adjusted outlook from Digi” and a provision in Bangladesh.Frank Maao, an analyst at DNB ASA, said that the new outlook constitutes an implicit lowering of Ebitda growth guidance to about minus 1%. The numbers were “soft,” driven by weakness in Pakistan and Norway, he said.What Bloomberg Intelligence says...Telenor’s muted 2Q growth and lowered full-year outlook provide some sobering context for the company’s plans for a comprehensive merger of its Asian operations with Axiata. The deal, if approved, will help unlock additional cost savings and investment efficiencies to protect cash flow from sustained top-line weakness.-- Matthew Bloxham, senior industry analyst, to read research, click here(Corrects name of BI analyst.)To contact the reporter on this story: Sveinung Sleire in Oslo at ssleire1@bloomberg.netTo contact the editor responsible for this story: Jonas Bergman at jbergman@bloomberg.netFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
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