Nordic telecommunications operator TeliaSonera on Tuesday reported a 7.7% rise in first-quarter net profit, despite higher costs, thanks to higher sales.
The Stockholm-based company said it aims to save a further 1.5 billion kronor (163 million euros; $221 million) in 2007 due to a reorganization of the business, particularly in Sweden and Finland. The measures are expected to give it an annual gross savings effect of 2.3 billion (250 million euros; $340 million) as of next year, it said.
In the three-months ended March 31, net profit rose to 3.98 billion kronor (433 million euros; $588 million), up from 3.69 billion kronor in the same period last year. Revenue rose 3.4% to 22.72 billion kronor (2.47 billioneuros; $3.35 billion) thanks mainly to growth in subscription numbers.
Chief Executive Anders Igel said he was happy with TeliaSonera's top- and bottom-line growth in the quarter, but that he was concerned with margin growth in the company's Broadband Services unit. "Therefore further efficiency measures are needed," in addition to ongoing programs addressing the migration from traditional services, he said in a statement.
TeliaSonera said it expected its sales to continue to grow this year, helping it reach its target of 100 billion kronor (10.88 billion euros; $14.77 billion) in 2008. The company also forecast its net income for 2007, when excluding one-off items, to be "somewhat higher" than in 2006.