Feb. 3 (Bloomberg) -- TDC A/S, Denmark’s biggest phone company, reported fourth-quarter earnings that missed analyst estimates on competition in the Danish mobile market.

Fourth-quarter profit from continuing operations gained 12 percent to 704 million kroner ($124 million), Copenhagen- based TDC said today in a statement. That missed the average estimate of 737 million kroner from eight analysts surveyed by Bloomberg. Sales declined 1 percent to 6.69 billion kroner, compared with 6.63 billion kroner predicted by analysts.

TDC bought Onfone ApS in May for 313 million kroner, removing a competitor that drove down monthly bills on the cheapest contracts by as much as 50 percent. The company forecast flat to declining earnings as customers cut their use of voice minutes and continue to shop for better deals.

TDC predicted further “erosion” in average revenue per user in 2012. “We expect to be impacted by the additional negative regulatory effects related to roaming prices,” the company said.

The phone operator said it expects 2012 revenue of 26 billion kroner to 26.5 billion kroner, compared with 26.3 billion kroner this year. TDC forecast that earnings before interest, taxes, depreciation, amortization and pension income will be 10.3 billion kroner to 10.5 billion kroner, compared with 10.5 billion kroner in 2011.

TDC shares were little changed at 45.55 kroner at 9:11 a.m. in Copenhagen. The stock has declined 4 percent in the last six months.

The Danish company is initiating a share buyback program in 2012 for as much as 750 million kroner, it said in a separate statement.

--Editors: David Risser, Robert Valpuesta

To contact the reporter on this story: Diana ben-Aaron in Helsinki at dbenaaron1@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net