Annual report 2012

4. Segment reporting

Telekom Slovenije Group has four operating segments. Segment reporting disclosures comply with requirements of the management relating to reporting for internal users.

The criterion for segment reporting is the registered office where an activity is performed, namely: Slovenia, Macedonia, Kosovo and other countries. Thus, the Group reports on the following segments:

  • Slovenia – encompasses companies with a registered office in Slovenia and activities in the areas of fixed and mobile telephony telecommunication services, the installation and maintenance of telecommunications network, the provision of multimedia and internet services, and digital content and television. This segment includes Telekom Slovenije, GVO, Avtenta, TSmedia, Soline and M-Pay as a joint venture;
  • Macedonia – includes companies with a registered office in Macedonia, i.e. One and Digi Plus  Multimedia. Activities in this segment include telecommunication services and the marketing of digital television services;
  • Kosovo – includes Ipko, which provides telecommunication services in Kosovo; and
  • Other countries – comprises other Group companies, i.e. Aneks, Primo, SIOL Zagreb, SiOL Sarajevo and SIOL Podgorica, and Gibtelecom Gibraltar, which is included in the segment as a jointly controlled entity using the equity method. The core activity of this segment is the provision of telecommunication services.

Segment reporting is based on the financial statements of the Telekom Slovenije Group. Sale transactions between individual segments are effected at market values. Intragroup transactions are eliminated in the consolidation procedure and included among eliminations and adjustments.

The Group does not disclose finance income and expenses per segments as the Group's financing is centralised and conducted on the level of the parent company.


Operating segments in 2012

1 Intersegment revenue is eliminated from consolidation.
2 Operating profit or loss per segment includes a loss from intersegment transactions in the amount of EUR -3,823 thousand.
3 Segment assets are net of loans in the amount of EUR 15,848 thousand, other investments in the amount of EUR 50,515 thousand, deferred tax assets in the amount of EUR 21,238 thousand, income tax credits in the amount of EUR 17,566 thousand, and the elimination of intragroup transactions in the negative amount of EUR -61,581 thousand.
4 Investments in intangible assets and property, plant and equipment include increases in the costs (additions) of intangible assets, land, buildings, equipment, inclusive of assets obtained through acquisition of subsidiaries.
5 Segment liabilities are net of loans in the amount of EUR 127,818 thousand, bonds issued in the amount of EUR 298,196 thousand, finance lease liabilities in the amount of EUR 1,828 thousand, other financial liabilities in the amount of EUR 24,088 thousand, deferred tax liabilities in the amount of EUR 6,609 thousand, income tax payable in the amount of EUR 230 thousand, and the elimination of intragroup transactions in the negative amount of EUR -45,320 thousand.

EUR thousand

Slovenia

Macedonia

Kosovo

Other countries

Elimination and adjustment

Consolidated

External sales

666,642

58,687

51,226

8,568

0

785,123

Intersegment sales 1

74,638

13,468

18,151

10,077

-116,334

0

Total segment revenue

741,280

72,155

69,377

18,645

-116,334

785,123

Other revenue

6,603

1,483

123

149

-424

7,934

Share in profit or loss of joint ventures

6

 

 

4,797

 

4,803

Cost of goods and materials sold

-56,538

-2,540

-1,084

-89

10,082

-50,169

Cost of materials

-24,176

-2,248

-1,962

-327

6,792

-21,921

Cost of services

-314,450

-49,946

-33,892

-13,535

90,908

-320,915

Employee benefits expense

-145,932

-5,951

-4,911

-2,033

1,614

-157,213

Amortisation and depreciation expense

-145,831

-14,734

-18,736

-2,790

3,059

-179,032

Other operating expenses

1,633

-3,442

-3,200

-1,550

480

-6,079

Total operating expenses

-685,294

-78,861

-63,785

-20,324

112,935

-735,329

Operating profit per segment 2

62,595

-5,223

5,715

3,267

-3,823

62,531

Finance income

 

 

 

 

 

8,022

Finance costs

 

 

 

 

 

-24,291

Profit before tax

 

 

 

 

 

46,262

Income tax expense

 

 

 

 

 

-2,575

Profit for the period

 

 

 

 

 

43,687

 

 

 

 

 

 

 

Other segment information
as at 31 December 2012

 

 

 

 

 

 

Segment assets 3

1,234,181

97,746

146,620

32,604

43,586

1,554,737

Impairment of segment assets

0

0

-2,223

-1,052

0

-3,275

Carrying amount of goodwill

919

0

0

1,532

0

2,451

Investments in subsidiaries and joint ventures under the equity method

6

0

0

683

0

689

Investments in intangible assets 4

25,143

794

1,642

170

0

27,749

Investments in property, plant and equipment 4

66,531

8,338

15,053

5,059

0

94,981

Segment liabilities 5

271,796

29,578

15,198

9,999

413,449

740,020


Revenue per market in 2012

EUR thousand

Slovenia

Macedonia

Kosovo

Other countries

Elimination and adjustment

Consolidated

Revenue from the sale of products and services in domestic market

556,786

53,638

49,279

8,002

0

667,705

Revenue from the sale of goods and materials in domestic market

26,591

2,114

450

84

0

29,239

Total sale in domestic market

583,377

55,752

49,729

8,086

0

696,944

Revenue from the sale of products and services in foreign market

82,992

2,925

1,497

476

0

87,890

Revenue from the sale of goods and materials in foreign market

273

11

0

6

0

290

Total sale in foreign market

83,265

2,936

1,497

482

0

88,180

Total revenue

666,642

58,687

51,226

8,568

0

785.123


2011

1 Intersegment revenue is eliminated from consolidation.
2 Profit before tax per segment includes profit from transactions among individual segments in the amount of EUR 5,868 thousand.

EUR thousand

Slovenia

Macedonia

Kosovo

Other countries

Elimination and adjustment

Consolidated

External sales

701,524

56,540

48,931

8,090

0

815,085

Intersegment sales 1

78,931

10,115

21,170

9,991

-120,207

0

Total segment revenue

780,455

66,655

70,101

18,081

-120,207

815,085

Other revenue

6,961

2,383

262

204

-388

9,422

Share in profit or loss of joint ventures

6

 

 

4,958

 

4,964

Cost of goods and materials sold

-55,899

-1,752

-1,573

-68

8,934

-50,358

Cost of materials

-20,278

-655

-1,858

-395

6,471

-16,715

Cost of services

-323,493

-49,309

-33,971

-13,151

96,109

-323,815

Employee benefits expense

-140,426

-6,481

-4,850

-2,026

3,623

-150,160

Amortisation and depreciation expense

-159,261

-23,432

-17,631

-2,247

10,205

-192,366

Other operating expenses

-15,545

-16,776

-695

-912

1,121

-32,807

Total operating expenses

-714,902

-98,405

-60,578

-18,799

126,463

-766,221

Operating profit per segment 2

72,514

-29,367

9,785

-514

5,868

63,250

Finance income

 

 

 

 

 

10,074

Finance costs

 

 

 

 

 

-24,506

Profit before tax

 

 

 

 

 

48,818

Income tax expense

 

 

 

 

 

-14,807

Profit for the period

 

 

 

 

 

34,011

 

3 Segment assets are net of loans in the amount of EUR 12,063, bank deposits in the amount of EUR 11,119 thousand, deferred tax assets in the amount of EUR 22,561 thousand, income tax credits in the amount of EUR 2,659 thousand and elimination of intragroup transactions in the negative amount of EUR -52,846 thousand.
4 Investments in intangible assets and property, plant and equipment include increases in the costs (additions) of intangible assets, land, buildings, equipment, inclusive of assets obtained through acquisition of subsidiaries.
5 Segment liabilities are net of loans in the amount of EUR 163,476 thousand, bonds issued in the amount of EUR 298,193 thousand, finance lease liabilities in the amount of EUR 2,809 thousand, other financial liabilities in the amount of EUR 23,990 thousand, deferred tax liabilities in the amount of EUR 9,785 thousand, income tax liability in the amount of EUR 35 thousand, and elimination of intragroup transactions in the negative amount of EUR- 40,588 thousand.

Other segment information
as at 31 December 2011

 

 

 

 

 

 

Segment assets 3

1,297,221

99,523

153,999

29,015

-4,444

1,575,314

Impairment of segment assets

0

-6,327

0

-185

0

-6,512

Carrying amount of goodwill

919

0

0

1,532

0

2,451

Investments in subsidiaries and joint ventures under the equity method

6

0

0

1,196

0

1,202

Investments in intangible assets 4

14,746

865

1,163

67

0

16,841

Investments in property, plant and equipment 4

50,798

4,969

10,663

5,073

0

71,503

Segment liabilities 5

252,909

25,397

14,224

9,809

457,700

760,039


Revenue per market in 2011

EUR thousand

Slovenia

Macedonia

Kosovo

Other countries

Elimination and adjustment

Consolidated

Revenue from the sale of products and services in domestic market

601,181

53,645

46,539

7,310

0

708,675

Revenue from the sale of goods and materials in domestic market

28,632

1,668

874

60

0

31,234

Total sale in domestic market

629,813

55,313

47,413

7,370

0

739,909

Revenue from the sale of products and services in foreign market

70,971

1,202

1,518

708

0

74,399

Revenue from the sale of goods and materials in foreign market

740

25

0

12

0

777

Total sale in foreign market

71,711

1,227

1,518

720

0

75,176

Total revenue

701,524

56,540

48,931

8,090

0

815,085