Telenor Swings To Net Loss As Indian Writedown Weighs

Norwegian telecommunications firm Telenor ASA (TEL.OS) Wednesday said it will be careful about future investments in India after the country's Supreme Court revoked its mobile licences, as it reported a fourth-quarter net loss due to a large writedown.

"We are working to protect our investments in all possible manners, and will consider every option prior to any further investment," Telenor said, adding that it expects Indian authorities to conduct a swift and fair process.

India's Supreme Court last week ordered the cancellation of 122 telecom licenses--including 22 held by Unitech Wireless, Telenor's joint venture with local real-estate company Unitech Ltd (507878.BY). The order will become effective in four months.

The ruling prompted Telenor to take a NOK4.2 billion ($724 million) impairment charge, as it wrote down the value of its licences and goodwill in India. After the writedown, Telenor's accounting exposure to India is NOK2.4 billion after tax.

The one-off charge hit net income for the quarter, which fell to a NOK1.94 billion net loss, from a NOK3.44 billion profit in the same quarter of 2010 and against expectations for a NOK2.06 billion net loss.

Revenue, however, rose on the year to NOK25.43 billion from NOK24.86 billion the same quarter the year before, driven by a robust Swedish market and growth in Asia. Analysts had expected revenue at SEK25.07 billion

The company's earnings before interest, taxes, depreciation, and amortization came in at NOK7.084 billion, from NOK6.96 billion the same quarter 2010, against expectations for NOK7.60 billion.

Telenor said it expects organic revenue growth above 5% in 2012, while it sees its Ebitda-margin before other income and expenses in the range of 32% and 33%.

Capital expenditure as a proportion of revenues, excluding licences and spectrum, is expected to be in the range of 12% and 13% this year.

For 2011, Telenor's board of directors proposes a dividend of NOK5.00 a share.

Tuesday, shares in Telenor closed at NOK93.80.

-By Sven Grundberg, Dow Jones Newswires; +46-8-5451-3098; sven.grundberg@dowjones.com

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