Dutch telecom KPN to issue $5.4 billion in shares
KPN reported a net loss of 160 million euros in the fourth quarter of 2012. For the full year 2012 the company reported a net profit of 693 million euros, 55 percent less year-on-year when it was 1.5 billion euros. Sales in Q4 fell by 3 percent from 3.3 to 3.2 billion euros, and in the full year sales fell by 3.5 percent from 13.1 to 12.7 billion euros.
"In order to execute on our strategy and position KPN for future growth, we need to strengthen the balance sheet. In recent years, KPN's financial position has been impacted by rising debt levels combined with increased commercial investments. The 4 billion euros rights issue announced today and our earlier announcements of a lower dividend outlook will support our financial position in the coming years," said Eelco Blok, chief excutive officer of KPN.
KPN is struggling with sales thanks to the increasing use of mobile internet which reduces the income from telephone and SMS traffic. "In The Netherlands, we are approaching a new balance between a focus on market positions and achieving stable performance. In Germany and Belgium, the next phases in our challenger strategy are being implemented to fuel underlying growth in 2013 and beyond," said Mr. Blok. ■