Salt satisfied with 2017 financial year despite slump in net profit

This was due to significantly higher depreciation and amortization as well as a marked increase in financial costs as the debt burden became heavier. In purely operational terms, however, Salt has improved its profitability thanks to the cost-cutting measures.

Sales shrank by 6.7% to CHF 1.052 billion, as the annual report shows. A large part of the decline is due to the massive reduction in mobile network transmission fees, known as mobile termination fees.

In addition, average monthly revenue per customer fell noticeably by 8.4% due to the price war. This was only partially offset by the increase in cell phone customers and the sale of more expensive smartphones.

At least the bloodletting among prepaid customers came to an end. Compared to the previous year, their number rose by 2 percent to 683,000, while Salt increased the number of subscription customers by 1.7 percent to 1.223 million.

Operating profit before depreciation and amortization (EBITDA) improved by 9.9% to CHF 471.8 million despite the drop in sales. The increase in profit was only achieved by reducing costs.

Fewer jobs

Personnel expenses fell by a fifth. Last year, Salt cut 43 jobs and still had 703 full-time employees at the end of December. Salt also spent less on advertising, network and IT.

Depreciation and amortization increased by a fifth. As a result, operating profit fell by almost 14 percent to 141.7 million francs. Below the line, the net profit of Salt parent company Matterhorn Telecom Holding fell from CHF 98.1 million to CHF 36.9 million. This was due to higher financial costs, which climbed by almost half as a result of increased debt.

In a press release, Salt expressed its satisfaction with the results. "We were able to maintain our growth momentum in 2017 and successfully complete our transformation," commented CEO Andreas Schönenberger.

Fixed network launch soon

Now the company, which is owned by French entrepreneur Xavier Niel, wants to open a new chapter: The launch into the fixed network is imminent: "We are now ready (...) to offer our customers the full range of telecommunications services, including revolutionary ultra-fast broadband solutions at customer-friendly prices," said Schönenberger.

The fixed network plans have already been known for a year, after the mobile operator concluded contracts for the use of the fiber optic networks of electricity suppliers, including the EWZ in Zurich. Salt has always remained stubbornly silent about the launch date. When asked on Wednesday, a spokesperson only said: "Soon."

In the past, there had been repeated speculation about Salt launching its own fixed network offering. This is because bundled offers comprising mobile telephony, fixed network, Internet and television, as offered by competitors Swisscom, Sunrise and UPC, are considered by experts to be decisive for the success of a telecommunications company. Customers who have bundled offers are much less likely to switch to the competition than those who only purchase individual services such as mobile telephony.

With its entry into the fiber optic network, Salt is building on its own history. In 2008, the former Orange was the first provider of TV, Internet and telephony on the EWZ fiber optic network. At the end of 2010, the pioneer left the "data highway of the future" again after Orange had hardly gained any customers. (SDA)