Hrvatski Telekom H1 2025 slides: Revenue up 4.4% as service growth accelerates

Introduction & Market Context

Hrvatski Telekom (HT), Croatia's leading telecommunications provider, reported solid financial results for the first half of 2025, with revenue growth accelerating across both mobile and fixed segments. The company presented its H1 2025 results on July 24, highlighting continued momentum in its core business while maintaining substantial infrastructure investments.

The telco continues to strengthen its market position in Croatia, having been recognized by the Croatian Regulatory Authority for Network Industries (HAKOM) for the best mobile network in the country for the third consecutive year. Trading at EUR 42.20 as of July 23, 2025, the company's shares have performed well, sitting closer to their 52-week high of EUR 45.60 than their low of EUR 30.10.

Quarterly Performance Highlights

Hrvatski Telekom reported a 4.4% year-over-year increase in total revenue for H1 2025, reaching EUR 544.5 million compared to EUR 521.6 million in the same period last year. This growth was primarily driven by strong performance in service revenues across both mobile and fixed segments.

As shown in the following chart of the company's financial performance, adjusted EBITDA after leases (AL) grew by 3.0% to EUR 193.7 million, while net profit increased by 1.6% to EUR 58.0 million:

The company maintained a high level of capital investments, with Capex AL increasing by 15.1% year-over-year to EUR 116.9 million, reflecting Hrvatski Telekom's continued focus on infrastructure development:

Detailed Financial Analysis

Service revenue growth was particularly strong in H1 2025, with mobile service revenue increasing by 7.4% to EUR 183.4 million and fixed service revenue rising by 6.0% to EUR 164.5 million. System solutions revenue also showed modest growth of 1.2%, while non-service revenues declined slightly in both mobile and fixed segments.

The following breakdown illustrates the composition of Hrvatski Telekom's revenue growth in Croatia:

The company's operational metrics also showed positive trends, with mobile postpaid customers increasing by 4.5% to 1.58 million, while average revenue per user (ARPU) in this segment grew by 5.4% to EUR 15.5. The prepaid customer base expanded even more rapidly, growing by 9.4% to 983,000 customers, although ARPU in this segment declined by 11.2% to EUR 4.6:

In the fixed segment, Hrvatski Telekom reported modest growth in retail broadband access lines, which increased by 0.7% to 671,000, while TV customers and retail fixed voice mainlines both decreased slightly by 0.7%. Wholesale customers declined by 3.3% to 169,000.

The company's Montenegrin subsidiary, Crnogorski Telekom, delivered particularly strong results, with revenue increasing by 3.4% to EUR 44.1 million and net profit surging by 57.2% to EUR 3.3 million:

Strategic Initiatives

Hrvatski Telekom continues to focus on infrastructure development, expanding its fiber-to-the-home (FTTH) network by approximately 20% year-over-year. This investment supports the company's position as the provider of the largest FTTH network in Croatia.

The company highlighted several strategic achievements during the presentation, including:

• Maintaining the highest customer experience ratings in the Croatian market
• Winning exclusive broadcasting rights for the Croatian national football league (HNL) matches for an additional five years
• Confirming the separation of passive mobile infrastructure into a wholly owned subsidiary
• Appointing new members to the Management Board

Additionally, Hrvatski Telekom continued its share buyback program throughout the first half of 2025, acquiring 705,000 shares. The company also distributed a dividend of EUR 1.64 per share, representing a 7.2% increase compared to the previous year.

Forward-Looking Statements

Looking ahead, Hrvatski Telekom provided a cautiously optimistic outlook for the full year 2025, projecting low-single-digit increases across key financial metrics compared to 2024 results:

The company also indicated that it is monitoring and evaluating potential merger and acquisition opportunities for regional expansion, suggesting possible strategic growth beyond its current markets in Croatia and Montenegro.

With its continued focus on network infrastructure investment, service revenue growth, and strategic initiatives, Hrvatski Telekom appears well-positioned to maintain its market leadership in Croatia while pursuing moderate but steady growth in the coming quarters.

Full presentation:

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