The failure of a high-profile merger with rival TeliaSonera in Denmark took a toll on Telenor’s Q4 profitability.

Across the group, EBITDA grew by 17. 5 per cent in Q4 2015 to NOK10.6 billion ($1.24 billion), but Telenor slumped to a net loss of NOK1.4 billion, compared with a net profit of NOK1.4 billion in the year-ago period.

The reason was an impairment charge of NOK2.1 billion relating to its Danish operations, as well as an increase in depreciation and amortisation charges across the group.

Revenue in Q4 2015 was NOK33.5 billion, an increase from NOK30.4 billion (a re-presented figure) in the year ago period.  Organic revenue growth was 2.3 per cent, assuming fixed currency.

The Danish market, which Telenor defines as “challenging”, is certainly doing some damage to the company’s balance sheet. The company noted ARPU decline due to interconnection rate cuts and a shift to cheaper tariffs, and a “turnaround process” is being initiated following the failed merger.

Telenor Denmark ceased to be classified as a discontinued operation as of Q3 2015, and its parent represented some past financial figures in Q4 as a result.

Looking ahead, Telenor forecast “healthy” organic revenue growth in 2016 but warned that competition in the key markets of Thailand and Malaysia will take a toll on profitability.

Based on this analysis, the company said organic revenue growth will be in the range of 2 per cent to 4 per cent this year (down from 4.7 per cent in 2015), while EBITDA margin will be between 33 per cent to 34 per cent, down from 34.5 per cent in 2015.

Its capex to sales ratio is expected to be 17 per cent to 19 per cent, compared with 18.4 per cent.