Telefonica impresses with 9.8% rise in net profit for 1Q 2009

13 May 2009

Spanish telecom giant Telefonica has reported its financial results for the three months ended 31 March 2009, posting a better-than-expected 9.8% year-on-year rise in net profit. The group reported net profit for the quarter at EUR1.69 billion (USD2.3 billion), noting that strong performance from its Latin American operations helped to offset less impressive results from its Spanish and European units. Group revenue for the three-month period was EUR13.73 billion, down 1.3% against the same period last year; revenues from Telefonica Espana and Telefonica Europe fell 4.2% and 6.6% respectively compared to a 4.8% revenue increase at Telefonica Latinoamerica. Commenting on the revenue drop in Spain the operator noted it reflected ‘slowdown in the market as a whole, the stiff competition and lower consumption of voice services from customers’. Consolidated operating income before depreciation and amortisation (OIBDA) fell 0.4% y-o-y to EUR5.35 billion, but the company has maintained its guidance for a 1%-3% rise in OIBDA for the 2009 fiscal year.

The group’s total wireless customers surpassed 198 million at the end of the quarter, up 15.4% against the 171 million at end-March 2008, with Latinoamerica driving growth once again, posting a 20.2% increase in subscribers to reach 124.66 million. By contrast, wireless subscribers for the group’s Spanish arm increased by just 5.1% to 53.9 million. Total retail internet broadband accesses for the group also rose against 1Q 2008, up 17.5% to 12.78 million, while group-wide wholesale accesses jumped 28.6% y-o-y to 3.65 million.

Spain, Telefonica