In Q2 2022, revenue from internet access services amounted to HRK 1.38bn, an increase of 7.07% YoY.

HAKOM has recently published its ICT market data for Q2 2022 in Croatia. According to the report, total revenue from fixed public communication networks amounted to HRK 257m, a decrease of -5.7% YoY. Of that, revenue from retail amounted to HRK 231.2m, decreasing by -2.5% YoY, while wholesale revenue amounted to HRK 25.9m, a decrease of app. -27% YoY. Meanwhile, the total number of subscribers amounted to 1.2m, a decrease of -1.4%. Of that, HT currently holds the largest market share of 45%, remaining at the same level YoY, while other participants in the market hold the remaining 55%.

Total revenue from telephone services in mobile public communications in Q2 2022 declined to HRK 869m, a decrease of -2.66% YoY. Such a decrease came both on the back of decreases in retail revenue, which decreased by -0.72% and amounted to HRK 713.5m, and the wholesale revenue, which decreased by -10.69% and amounted to HRK 155.2m. In the retail segment, revenue from residential users, which constitutes 76% of the retail revenue, remained flat and amounted to HRK 534m. At the same time, revenue from business users decreased by -0.2% YoY and amounted to HRK 179m. Meanwhile, the total number of active mobile subscribers amounted to 4.507.074, a slight increase of 2.3% YoY.

Looking at the market share by subscribers, we can see that the situation remains mostly unchanged for the last couple of quarters, with HT maintaining the highest market share at 45% (a slight decrease from Q1), followed by A1, which currently holds a 35.3% market share. Lastly, we have Telemach, which holds 19.7% of the current mobile market share, an increase of 0.3 p.p. QoQ, and 0.1 p.p. YoY.

Mobile subscribers market share (Q4 2019 – Q2 2022, %)

Total revenue from internet access services amounted to HRK 1.4bn, an increase of 7.1% YoY. The increase came solely on the back of mobile internet revenue increase, which increased by 12.5% and amounted to HRK 920m. Fixed internet revenue decreased slightly by 2.3%. The total number of internet subscriptions also increased, growing by 4.4% and amounting to 5.994.673.

Total revenue from television services increased by 4.5% to HRK 220m, with the total number of pay-TV subscribers amounting to 878k, an increase of 0.4% YoY. IPTV users were up by 1% and amounted to 452k, while at the same time, satellite TV users decreased by -4.8% and amounted to 139k.

So, with all this data in mind, how did the two largest telecom companies in Croatia, Hrvatski Telekom and A1 perform during Q2 2022?

Hrvatski Telekom

The trends seen in the whole market are also quite reflective of the largest telecom company in Croatia. During the second quarter of 2022, HT recorded revenues of HRK 1.8bn, a decrease of 3% QoQ. Compared to Q1 2022, HT’s EBITDA margin decreased, while it increased its profit margin by 80bps. HT also remained a leading investor in digital infrastructure. Looking at H1 2022 organic revenues, (when adjusted for Optima Telekom’s contribution), increased slightly by 0.5%. Mobile service revenue was up 5.3% or HRK 63m, supported by strong postpaid and visitors and roaming, which offset the lower prepaid income. Fixed services revenues remained mostly flat, increasing by a slight 0.2% YoY.

Organic adjusted EBITDA after leases grew 4.3% YoY, representing a positive trend in the business model. OPEX decreased by HRK 21m, or 1% YoY. This decrease happened due to a lower material cost, which decreased by -2.9% YoY, employee benefits expenses (-1.6%), and write-down of assets (-24.7%). Finally, net profit amounted after minorities amounted to HRK 126m, an increase of 10% YoY.

A1

Meanwhile, the 2nd largest telecom company in the Croatian market, A1, recorded revenue of HRK 1.2bn, an increase of 3.7% QoQ. Services revenue grew by 5% and amounted to HRK 1bn. Service revenues and EBITDA reported growth in all markets. The total mobile subscriber base increased by as much as 4.3%, while internet@home subscribers also grew by 4.9% YoY. It should be noted that A1 Hrvatska is a part of A1 Telekom Austria, which besides these 2 countries has several other countries as a part of the Group.