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16 May 2007
MADRID – Spanish telecoms operator Telefonica SA on Wednesday posted a 7.7 percent increase in first-quarter net profit, buoyed by contributions from its 02 mobile service and strong growth in its domestic fixed-line and high-speed Internet access services.
Madrid-based Telefonica, the largest telecommunications company in Spain and Latin America, said net profit rose to EUR 1.26 billion (US$1.71 billion) from EUR 1.17 billion a year earlier. Revenue increased 15 percent to EUR 13.75 billion (US$18.61 billion).
The results are slightly skewed in Telefonica’s favor because the consolidation of Colombia Telecom was not included in the first-quarter earnings the previous year, and the purchase price allocation of 02 was calculated from February 2006.
Operational income before depreciation and amortization, or Oibda, stood at €5.11 billion (US$6.92 billion) in the quarter, up 9.6 percent from €4.66 billion. Oibda is the company’s preferred measure of profitability, equivalent to earnings before interest, taxes, depreciation and amortization.
The shares fell 0.8 percent to €16.68 (US$22.58) in a broadly negative market.
Domestic unit Telefonica Espana achieved the highest revenue among the company’s divisions in the quarter and grew 5.5 percent more than a year earlier. Revenue at its fixed-line division stood at €3.05 billion (US$4.13 billion), 3.6 percent higher than a year earlier. Revenue from its Internet access service increased 22.3 percent to EUR 675 million (US$913.82 million).
Revenue from its Spanish cellular arm rose 7.9 percent to EUR 2.34 billion (US$3.17 billion). The company had 21.8 million mobile customers in Spain during the quarter, 7.6 percent more than a year earlier.
Revenue at Telefonica’s European 02 unit stood at EUR 3.53 million (US$4.78 million), 47 percent higher than a year earlier.
Telefonica’s high-growth Latin American division reported a revenue increase of 8.5 percent to EUR 4.69 million (US$6.35 million). The company got a boost in the quarter from the consolidation of the Colombian operator Telefonica Telecom and registered revenue growth in all of its Latin American units except in Brazil, Chile and Ecuador.
Telefonica said worldwide customers stood at EUR 206.5 million, 11 percent more than a year earlier.
[Copyright AP with Expatica]
Subject: Spanish news