Swisscom reports struggle with low prices
The Swiss telecoms company reported on Wednesday a rise in profits for the third quarter.Geneva -- Swiss telecoms operator Swisscom reported on Wednesday a 16.6 percent increase in nine-month net profit mainly due to one-time items, warning that its core Swiss business was suffering from stiff price competition.
Swisscom said that net profit was CHF 1.53 billion (EUR 990 million, USD 1.52 billion) in the first nine months of 2009 from CHF 1.31 billion over the same period in 2008.
However, the outcome would have been stable, excluding the effect of depreciation and leasing charges.
Net sales dropped by 1.8 percent year-on-year to CHF 8.92 billion, the company added in a statement.
"Growth in customer numbers and new offerings were unable to offset the effects of the ongoing price erosion brought on by stiffer competition and regulatory changes, prompting a drop of around CHF 240 million in domestic business," it said.
However, IT services recorded a more than doubling in orders over the same period in 2008 to CHF 458 million, while revenue at Italian internet and telecoms subsidiary Fastweb grew 10 percent.
Swisscom said it expected the decline in its Swiss business to continue for the rest of 2009.
It predicted a CHF 300 million drop in revenue for the full year to about CHF 9.2 to 9.3 billion, largely in line with the forecast it made in March.
AFP / Expatica