Telecom Italia reports 4.5% drop in profit

8 May 2009

Telecom Italia (TI) has reported a 4.5% year-on-year drop in net profit for the first quarter of 2009, down to EUR463 million (USD617.8 million). Consolidated group revenues were down EUR486 million to EUR6.79 billion for the period ended 31 March 2009. EBITDA dropped EUR145 million to EUR2.79 billion. CAPEX also fell in the first quarter, down to EUR1.03 billion from EUR1.23 billion in 1Q 2008. CEO of TI Franco Bernabe said, ‘It was a satisfactory quarter in light of the macroeconomic climate, in which the recovery of efficiency continues… The trend in revenues reflects the impact of sales networks restructuring, already announced in the strategic plan, and the effects of commercial policies tailored to customers who, particularly in the mobile business, showed greater care in telecommunications spending.’

In its domestic operations TI reported a 9.5% year-on-year drop in wireline subscriptions, down to 19.58 million at the end of March 2009. The telco added 195,000 net new broadband subscriptions in the quarter, with a total of 8.33 million. Mobile subscriptions fell to 34.16 million, a 4.9% decline on the previous year. TIM Brasil reported an 11% year-on-year growth in its mobile customer base, up to 36.09 million, as the company extended its network penetration to 80.5% of Brazil’s population.