Vodafone is the second-largest telecom operator in Romania in terms of users. The market leader is Orange Romania. “The impact of the economic situation is felt by all client categories in all industries. Lower revenues are mainly due to the drop of call termination tariffs by some 22 percent, a decision that is only affecting revenues of Vodafone and Orange in Romania,” the company’s CEO, Liliana Solomon, told Business Standard.
For the entire 2008-2009 fiscal year, which ended on March 31, the company posted total revenues worth €1.66 billion, 0.7 percent higher like-to-like, with revenues from services amounting to €1.11 bln, up 1.4 percent year-on-year. Orange Romania posted a 14 percent drop in revenues for January 1-March 31 and lost 237,000 clients. Vodafone Romania’s earning before interest, taxes, depreciation and amortizations (EBITDA) amounted to €527 million, 3.5 percent lower year-on-year, due to the fierce competition on the market, which led to higher costs for securing and preserving clients.
The company lost 61,000 clients in the first three months of 2009. “In an attempt to be more cost-efficient, some clients whith more SIM cards decide to forego part of them, while others cannot pay their bills anymore so they are disconnected. It is natural to have a tempered growth rate, given the market became mature,” Solomon said. Other competitors on this market are Cosmote Romania, owned by Greek OTE group, RCS&RDS, and Telemobil.
