February 13, 2018 / 7:22 PM / 3 months ago

UPDATE 1-Telekom Austria 2017 profit falls due to local brand write-offs

VIENNA, Feb 13 (Reuters) - Telekom Austria on Tuesday reported a 16 percent fall in its full-year profit largely due to write-offs related to the value of its local brands after the roll out of its “A1” brand throughout the group in different countries.

The company, part of Mexican tycoon Carlos Slim’s America Movil, reported net profit of 345.5 million euros ($426.83 million) on revenue of 4.38 (2016: 4.21) billion euros.

Telekom Austria has had a longstanding monopoly on mobile, landline and internet services in its home market. But competition has increased since the summer after mobile telecoms company Hutchison Drei Austria, bought landline-focused Tele2 and Deutsche Telekom agreed to take over cable provider UPC to expand its broadband services in Austria.

To harmonise its brands, Telekom Austria said in September it would gradually roll out its local brand “A1” in the seven other European countries where it operates and that the value of the local brands that will disappear will be written off until the end of the first quarter 2018.

The group’s mobile customers declined in 2017 due to a shift to postpaid offers, while solid demand for its fixed-line services and for smartphones helped revenue to grow, it said.

For 2018, it expects to increase revenue by 1-2 percent and to invest around 750 million euros, largely into its digital services, Telekom Austria said.

It plans to propose a dividend of 0.20 euros per share to the 2019 shareholders meeting for the financial year 2018, it said in a presentation without elaborating on a 2017 dividend.

$1 = 0.8095 euros Reporting by Kirsti Knolle. Editing by Jane Merriman

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