Swisscom said it faced “fierce” competition with global internet companies while reporting 2018 net profit that matched expectations amid looming market consolidation in Switzerland.
The internet, mobile phone and digital television provider reported net profit down 3 percent to 1.52 billion Swiss francs (£1.2 billion), matching estimates in an Infront Data poll.
The company, which is 51 percent owned by the Swiss government, proposed paying an unchanged dividend of 22 francs per share, in line with its previous guidance. It also plans the same payout for 2019 if it reaches its targets this year.
Chief Executive Urs Schaeppi said Swisscom was operating in a “challenging market environment.”
“The biggest challenges in 2019 will remain market saturation, increasingly fierce competition and high price pressure,” Schaeppi said in a statement.
Competition could increase in Switzerland after Sunrise Communications Group confirmed this week it was in talks over a potential acquisition of broadband provider Liberty Global’s Swiss business UPC Schweiz.
Should a Liberty-Sunrise deal be completed, Swisscom could suffer lower revenue from wholesale broadband and the loss of payments from UPC to use its network for its mobile business.
During 2018 Swisscom reported stable revenue at 11.7 billion francs, as a downturn Swiss business was offset by an improvement at its Italian Fastweb unit and cost cuts.
For 2019, Swisscom said it expects net revenue of around 11.4 billion Swiss francs, and earnings before interest, tax, depreciation and amortization of more than 4.3 billion francs, up from 4.2 billion francs, partly due to accounting changes.―Reuters