Telekom Austria AG — Earnings Release 2014

Aug 13, 2014

EANS-Adhoc: Telekom Austria AG / Telekom Austria Group - Results for the first half of 2014 (Ad-hoc)

ad-hoc disclosure transmitted by euro adhoc with the aim of a Europe-wide distribution. The issuer is solely responsible for the content of this announcement.

Earnings

Dear Sir or Madam,

Today the Telekom Austria Group (VSE: TKA, OTC US: TKAGY) announces its results for the first half of 2014, ending 30 June 2014.

Highlights

Group revenues decline by 7.3% and EBITDA comparable declines by 7.2%, mainly driven by regulation, macro-economic effects in CEE as well as extraordinary effects of EUR 28.2 mn net in Austria

Clean*: Group revenues -4.1% and Group EBITDA comparable flat at -0.1%

Group EBITDA comparable margin remains flat at 31.9% and increases to 33.2% on a clean basis*

Austria benefits from successful strategy implementation: regulation and extraordinary effects account for most of revenue decline; cost cuts and subsidy reductions result in strong EBITDA comparable trends (-0.2% excluding extraordinary effects)

Bulgaria: Macro effects and fierce competition drive customer and revenue decline in fixed and mobile; EUR 400 mn impairment due to adjustment of WACC and medium-term expectations

Croatia: solid fixed-line performance cannot offset regulatory cuts and effects of mobile competition; spectrum fee introduced in June will burden EBITDA comparable as of H2 2014

Belarus and Additional Markets segment achieve revenue and EBITDA comparable growth

Spectrum prolongations and acquisitions in Bulgaria and Slovenia strengthen network

Next step in implementation of successful convergence strategy: Acquisition of cable operator blizoo in the Republic of Macedonia in June (closed in July)

Commitment to broadband funding announced by Austrian government as of 2016

Group outlook for FY 2014 refined: Revenues of approx. -3.5% (from approx. -3.0%), CAPEX** of EUR 650 - 700 mn (from approx. EUR 700 mn), intended dividend of EUR 0.05/share

in EUR million				Q2 2014 Q2 2013 %change 1-6M 2014 1-6M 2013 %change
Revenues	963.0		1,043.2 -7.7%	1,939.0		2,092.3	-7.3%
EBITDA comparable	299.4	330.3	-9.3%	619.4		667.2	-7.2%
Operating income		-320.0 105.5	n.m.	-222.6		223.3	n.m.
Net income	-358.6 52.5		n.m.	-317.8		108.0	n.m.
Cash flow generated from operations 224.5 302.2 -25.7%							373.4 494.0 -24.4%
Earnings per share (in EUR)		-0.82 0.10		n.m.	-0.75 0.21		n.m.
Free cash flow per share (in EUR)		-0.01 0.29		n.m.	0.11	0.39	-71.9%
Capital expenditures			229.5 176.4 30.1%		329.0 325.4 1.1%
in EUR million			30 June 2014		31 Dec 2013		%change

Net debt 3,688.1 3,695.8 -0.2% Net debt / EBITDA comparable (12 months) 3.0 2.9 All financial figures are based on IFRS; if not stated otherwise, all comparisons are given year-on-year. EBITDA comparable is defined as net income excluding financial result, income tax expense, depreciation and amortisation, restructuring and impairment charges. * Excluding extraordinary effects in Austria and FX translation effects ** Does not include investment for spectrum and acquisitions Further information about the results can be found here: http://www.telekomaustria.com/en/ir/interim-results The earnings release can be found here: http://cdn1.telekomaustria.com/final/en/media/pdf/results-qu2-2014.pdf Kind regards, Telekom Austria Group Investor Relations --- Disclaimer for forward-looking statements: This document contains forward-looking statements. These forward-looking statements are usually accompanied by words such as "believe", "intend", "anticipate", "plan", "expect" and similar expressions. Actual events may differ materially from those anticipated in these forward-looking statements as a result of a number of factors. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results or outcomes to differ materially from those expressed in any forward-looking statement. Neither Telekom Austria nor any other person accepts any liability for any such forward-looking statements. Telekom Austria will not update these forward-looking statements, whether due to changed factual circumstances, changes in assumptions or expectations. This report does not constitute a recommendation or invitation to purchase or sell securities of Telekom Austria. --- Further inquiry note: Matthias Stieber Director Investor Relations Tel.: +43 (0) 50 664 39126 mailto: matthias.stieber@telekomaustria.com issuer: Telekom Austria AG Lassallestrasse 9 A-1020 Wien mail: investor.relations@telekomaustria.com WWW: www.telekomaustria.com/ir sector: Telecommunications ISIN: AT0000720008 indexes: WBI, ATX Prime, ATX

language: English

stockmarkets: official market: Wien

Aussendung übermittelt durch euro adhoc The European Investor Relations Service