Telefonica 3Q net profit jumps 39%

12 Nov 2007

Telefonica has announced that its third quarter profit rose 39%, boosted by a EUR1.4 billion (USD2.06 billion) gain from the sale of a stake in Dutch content provider Endemol, strong growth from its Latin American operations and lower taxes. Net income for the three months ended 30 September 2007 rose to EUR4.02 billion (USD5.88 billion) from EUR2.9 billion a year earlier. Sales rose 4.8% to EUR14.19 billion. Operating income before depreciation and amortisation climbed 29% to EUR6.98 billion.

Revenue at the group’s domestic unit Telefonica Espana grew 4.3% in the period to almost EUR5.27 billion, boosted by growth in high-speed internet services which offset a fall in fixed line revenue. However, revenue growth was less than in the second quarter, when it rose 6.5%, after regulators put a cap on mobile roaming rates and cut contract termination penalties charged to consumers. Total broadband clients in Spain rose 10% to 5.13 million at the end of September as the company migrated dial-up users to high-speed connections and added new ones. Telefonica’s Spanish cellular customer base also rose 6.7% in the period to 22.4 million. Telefonica’s Latin American division reported a revenue increase of 11% to EUR5.05 billion. Total clients in the region rose nearly 15% to 126.4 million at the end of September as the company’s Latin American mobile customer base grew 20% to 94.7 million.

Spain, Telefonica