BASE Company had a strong commercial start in 2013 with SNOW and new product portfolio

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- Underlying mobile service revenue growth of 1.9% y-on-y in Q1 2013, a solid performance against increasing competition resulting in higher customer churn
- EBITDA margin was lower in Q1 at 25.1% (Q1 2012: 31.4%), mainly due to highly competitive mobile market
- Net adds on prepaid in Q1 of 45k and negative 8k on postpaid
- Launch of broadband and fixed line offer with the new brand SNOW, new mobile product portfolio for consumers and B2B customers and increased network speed up to 42 Mbps

BASE Company, formally KPN Group Belgium, today published its results for the first quarter 2013

CEO Jos Donvil commented: “BASE Company made a strong start in 2013 but it is too early to see the results in the figures. Not only was there our launch as challenger on the fixed market with SNOW, we also changed all our tariff plans and on top increased our network speed with Dual Carrier. The telecom market remains highly competitive but with our new offers we are as we have always been the real mobile Challenger in the Belgian market. Not only do we offer the best prices, we have also an outstanding network quality”.

FINANCIAL DETAILS

Underlying revenues and other income increased by 1.7% y-on-y in Q1 2013, supported by underlying service revenue growth of 1.9%. Underlying service revenue growth slowed down as a result of increased competition in the Belgian mobile market. The EBITDA margin for Q1 declined by 6.3%-points, from 31.4% in Q1 2012. EBITDA in Q1 2013 was lower compared to the first quarter of 2012 due to higher traffic costs, costs related to the launch of SNOW and IT transformation costs.

The implementation of the new telecoms law and increased competition in the mobile market has resulted in higher customer churn and lower ARPU. The total customer base including Wholesale at the end of Q1 2013 was 3.5m customers which is an increase of 37k compared to the customer base end of Q4 2012. Net additions in Q1 went slightly down with a negative 8k in postpaid, while prepaid net adds remained positive at 45k. Impacted by regulation and increased competition postpaid ARPU was lower at EUR 35 in Q1 2013 (Q1 2012: EUR 40). We estimate that our current market share has grown y-on-y to ~20%.

OPERATIONAL HIGHLIGHTS

KPN Group Belgium announced to change its name to BASE Company gradually in the coming months. We recently introduced a number of new customer propositions. On 7 February 2013, we started to challenge the broadband and fixed line market with the new brand SNOW, offering clients a real alternative at very attractive prices. First results are very promising.

A total new mobile product portfolio was introduced on 17 April 2013, offering new tariff plans for both consumers and B2B customers, including unlimited voice and SMS. Next to the new product portfolio customers can now also experience increased speeds through the introduction of 3G dual carrier, doubling the speed to up to 42 Mbps with a population coverage of 61%.

COMMERCIAL DEVELOPMENTS

The newly launched tariff plans for consumers and B2B customers will be supported by a large communication campaign. Further commercial roll-out of SNOW is foreseen. Next to the further dual carrier roll-out BASE Company keeps working on the development of its 4G network.