Cesky Telecom CFO J. Sedivy said yesterday evening that the risk of write-offs of its investments in fixed-line infrastructure is “very realistic”. The exact size of the write-off remains subject to the outcome of the recent talks with the domestic regulator (CTU) regarding its policy over the coming two to three years. Mr. Sedivy also reiterated that the likely write-off should not impact CT’s dividend policy and the company would distribute 50-70% of its 2003 net profit adjusted for the write-offs (the dividends would be paid from CT’s retained earnings). The news is in line with previous reports and should not thus affect the CT stock price. Source: CTK.
Separately, Mr. Sedivy also said that CT is considering requiring CTU to cover its losses from the obligatory provision of universal services in 2003, while the size of this loss again depends on negotiations with CTU (there has reportedly been a positive shift in negotiations recently). Recall that CT has already asked the state (the IT Ministry) to cover its CZK 3bn losses from the provision of the services in 2001 and has initiated legal proceedings against CTU to cover its CZK 4.5bn losses incurred in 2002. Neutral at the moment. Source: CTK.
Jan Hájek, Patria Finance