Telefónica de Argentina profits down 71%

21 Feb 2007

Telefónica de Argentina (TAR), the former monopoly wireline provider in the south of the country and a unit of Spanish giant Telefónica, posted profits of ARS222 million (USD71.5 million) in 2006, 71% down on 2005’s figure. Sales were up 11.3% in 2006, totalling ARS3.75 billion, whilst operating expenses totalled ARS2.99 billion, up 10.7% year-on-year, the company reported to the Buenos Aires Stock Exchange. No further details were provided. Analysts believe the higher costs reflect TAR’s effort during 2006 to attract more clients, particularly to its wireless sister company Telefónica Comunicaciones Personales (TCP). Subscriber figures for the end of 2006 are yet to be published, but according to TeleGeography’s GlobalComms database TCP attracted more than 2.5 million new customers in the twelve months ended 30 September 2006, increasing its customer base to just under ten million and remaining the market leader.