Swisscom Switzerland
In CHF million, except where indicated | 2017 | 2016 | Change | |||
---|---|---|---|---|---|---|
Net revenue and results | ||||||
Telecom services | 6,464 | 6,662 | –3.0% | |||
Solution business | 1,084 | 1,072 | 1.1% | |||
Merchandise | 648 | 637 | 1.7% | |||
Wholesale | 578 | 591 | –2.2% | |||
Revenue other | 203 | 213 | –4.7% | |||
Revenue from external customers | 8,977 | 9,175 | –2.2% | |||
Intersegment revenue | 81 | 82 | –1.2% | |||
Net revenue | 9,058 | 9,257 | –2.1% | |||
Direct costs | (1,943) | (2,028) | –4.2% | |||
Indirect costs | (3,615) | (3,613) | 0.1% | |||
Segment expenses | (5,558) | (5,641) | –1.5% | |||
Segment result before depreciation and amortisation (EBITDA) | 3,500 | 3,616 | –3.2% | |||
Margin as % of net revenue | 38.6 | 39.1 | ||||
Depreciation, amortisation and impairment losses | (1,485) | (1,473) | 0.8% | |||
Segment result | 2,015 | 2,143 | –6.0% | |||
Operational data at end of period in thousand | ||||||
Fixed telephony access lines | 2,047 | 2,367 | –13.5% | |||
Broadband access lines retail | 2,014 | 1,992 | 1.1% | |||
Swisscom TV access lines | 1,467 | 1,418 | 3.5% | |||
Mobile access lines | 6,637 | 6,612 | 0.4% | |||
Revenue generating units (RGU) | 12,165 | 12,389 | –1.8% | |||
Bundles | 1,907 | 1,672 | 14.1% | |||
Unbundled fixed access lines | 107 | 128 | –16.4% | |||
Broadband access lines wholesale | 435 | 364 | 19.5% | |||
Capital expenditure and headcount | ||||||
Capital expenditure in property, plant and equipment and intangible assets | 1,654 | 1,755 | –5.8% | |||
Full-time equivalent employees at end of year (number) | 15,157 | 15,876 | –4.5% |
Net revenue for Swisscom Switzerland fell by CHF 199 million or 2.1% to CHF 9,058 million as a result of fierce competition and the downward trend in fixed-line telephony. Revenue from telecommunications services decreased by CHF 198 million or 3.0% to CHF 6,464 million, with almost half of the drop due to the declining subscriber base in the fixed-line telephony business, which fell by 320,000 connections or 13.5% to 2.0 million. The other half of the decrease resulted from price cuts for new bundled offerings, increased promotions, the inclusion of roaming fees in basic subscription charges and lower prices in the Enterprise Customers segment. In the solutions business with large customers, revenue increased by CHF 12 million or 1.1% to CHF 1,084 million. In spite of the very competitive environment, Enterprise Customers saw a 7% rise in incoming orders to around CHF 2.7 billion. For Wholesale, lower proceeds as a result of the reduction in termination tariffs on mobile networks were largely offset by higher inbound roaming volumes.
The number of mobile subscribers rose by 25,000 or 0.4% year-on-year to 6.64 million in a saturated market. Swisscom increased the number of subscribers to its postpaid lines by 90,000 or 2.0% to 4.64 million, whereas the number of prepaid lines decreased by 65,000 or 3.2% to 2.0 million. The markets for broadband and TV are also becoming increasingly saturated, and customer growth has slowed. The number of broadband connections rose by another 22,000 or 1.1% to 2.0 million, while the number of TV connections grew by 49,000 or 3.5% to 1.47 million. By the end of December 2017, i.e. just nine months after launch, over 1.3million customers representing approximately 2.7 million connections had opted for the inOne combined package . At the end of 2017, 1.9 million customers were using a bundled package, which represents a year-on-year increase of 14.1%. Revenue from bundled contracts increased year-on-year by CHF 335 million or 13.4% to CHF 2,837 million.
Segment expense fell by CHF 83 million or 1.5% to CHF 5,558 million. Excluding non-recurring items such as provisions recognised for headcount reduction or regulatory risks and gains from the sale of properties, the decrease was 2.0% on a like-for-like basis. The decrease of CHF 85 million or 4.2% in direct costs to CHF 1,943 million is due to the lower termination tariffs on mobile networks and lower costs of purchasing goods. At CHF 3,615 million, indirect costs were only marginally higher than the prior-year figure of CHF 3,613 million. Excluding non-recurring items, indirect costs fell by 0.7%, whereby the reduced costs resulting from the decrease in headcount were partially offset by the lower capitalised costs of self-constructed assets. Headcount fell year-on-year as a result of efficiency measures by 719 FTEs or 4.5% to 15,157. The segment result before depreciation and amortisation was CHF 116 million or 3.2% lower at CHF 3,500 million. A large portion of the drop in revenue was offset by cost savings, resulting in a decline of 2.4% on a like-for-like basis. Capital expenditure fell by CHF 101 million or 5.8% to CHF 1,654 million. Capital expenditure for the expansion of the broadband networks remained virtually unchanged at a high level, while customer-driven investment and investment in other infrastructure decreased.