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Telenor 3rd-qtr earnings lag forecasts as pandemic in Asia weighs

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FILE PHOTO: Telenor flag flutters next to the company's headquarters in Fornebu
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By Victoria Klesty

OSLO (Reuters) -Telenor on Thursday posted quarterly earnings that lagged estimates, citing the unexpected persistence of the COVID-19 pandemic in Asia, and said it was still awaiting authorities' approval for the sale of its Myanmar business.

Adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) for July-September fell 2% to 12.86 billion crowns ($1.52 billion), below the 13.19 billion analysts expected in a poll compiled by Telenor.

The group, half of whose revenue comes from Asia, said lockdowns and restrictions hit demand for telecoms services and slowed down recovery in Asia.

"This has taken longer than we thought at the start of the year," Chief Executive Sigve Brekke said, adding there were now signs of improvement in the Asian markets in spite of the restrictions.

"The low level of international travel and roaming volumes will likely remain until restrictions are eased and mass-vaccination has gained traction," Telenor said in a statement earlier.

Subscription and traffic revenue dropped to 20.7 billion crowns from 21.5 billion in the third quarter of 2020. Telenor's Myanmar business, which is being held for sale, was not included in the numbers.

MYANMAR

Telenor wrote off the value of its Myanmar operations earlier this year following a military coup in February, and in July agreed to sell its business in the Southeast Asian nation to Lebanese investment firm M1 Group for $105 million.

It has since cited pressure from the junta to activate intercept surveillance technology as the primary reason for its exit. Myanmar accounted for 7% of Telenor's earnings last year.

The current status of the process of getting the deal approved by Myanmar authorities in up in the air, Brekke said.

"Now it's just the decision process that remains. What we do now is we sit and wait, and meanwhile we have to run the operations on a daily basis," he told Reuters.

Myanmar's military rulers have asked Telenor executives not to leave the country pending regulatory approval.

(Additional reporting by Gwladys Fouche; Editing by Terje Solsvik, Christopher Cushing and Steve Orlofsky)

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