Spain's Telefonica profits soar on Latin America

11th November 2010, Comments 0 comments

Spanish telecoms giant Telefonica said Thursday net profits more than doubled in the third quarter, boosted by a revaluation of its stake in Brazilian cellphone operator Vivo and by growth in Latin America.

Net profit leapt 168.7 percent from the same period a year earlier to 5.059 billion euros (6.9 billion dollars), said Telefonica, Europe's second-largest telecommunications company by market capitalisation behind Britain's Vodafone.

Profits were boosted by the upward revaluation of Telefonica's previously held stake in Vivo. But they were impacted by restructuring costs in Germany of 202 million euros.

Telefonica said in July it had agreed to buy all Portugal Telecom's shares in Vivo to take control of the Brazilian operator. Telefonica and Portugal Telecom held 60 percent of Vivo through Brasilcel, a joint investment entity.

Sales climbed 7.3 percent to 15.227 billion euros in the quarter, the group said. In Latin America, source of 42 percent of Telefonica's income, revenues rose 10.7 percent.

On the Madrid stock market, Telefonica shares fell back 1.69 percent to 17.99 euros following the report, in a market that was down 1.13 percent.

Over the first nine months of the year, Telefonica said profits jumped 65.6 percent to 8.835 billion euros.

© 2010 AFP

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