Telenor is increasing its EBITDA margin outlook for the year after a cost-cutting drive boosted the operator’s second quarter results.

The Norway-based company said the EBITDA margin for the year was now predicted to be 38–39 percent, up from previous estimates of 37 percent.

Its revenue outlook is unchanged at a prediction of 1-2 percent growth.

In Q2, Telenor’s EBITDA margin hit 40 percent, up four percentage points year-on-year, thanks to a fall in opex and an increase in revenue.

Opex fell by NOK600 million versus 12 months ago thanks to cost saving initiatives in Norway, Malaysia, Denmark and Thailand.

In its home market, for example, where opex fell from NOK2.47 billion to NOK2.27 billion, the operator has cut jobs and reduced fault correction costs.

Group revenues rose two percent to NOK31.47 billion, largely thanks to the performance of the operator’s opco in Bangladesh.

Grameenphone, the Bangladeshi operator, grew revenues by 15 percent to NOK3.43 billion after adding 1.7million mobile subscriptions during the quarter.

Across the board, Telenor saw the number of mobile subscriptions rise by two million during the quarter to reach 173.9 million.

The Bangladeshi opco’s EBITDA also jumped 30 percent to NOK2.1 billion as a result of the improvement in sales and a cost efficiency drive, helping to push group EBITDA up 12 percent to NOK12.72 billion.

However, net profit fell from NOK1.8 billion to NOK634 million as Telenor cut VEON from its balance sheet.

The operator continues to reduce its stake in the company, selling 70 million shares in April, after it got burned by a corruption scandal in Uzbekistan.

Telenor said it had “discontinued recognising VEON as an associated company” in its financial statements.

"We deliver a strong set of results for the second quarter with improved revenue growth, double-digit EBITDA uplift and strong cash flow generation,” said Telenor CEO Sigve Brekke.

“Both the EBITDA and the EBITDA margin are [at an] all-time high this quarter.”

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