TI 1H13 revenues slump 7% to EUR13.76bn

2 Aug 2013

Telecom Italia (TI) has reported consolidated revenues of EUR13.760 billion (USD18.235 billion) for the six months ended 30 June 2013, down 7.0% from the EUR14.793 billion reported in 1H12. Of the total, EUR7.687 billion was derived from TI’s core domestic interests, down 10.3% year-on-year. Revenues generated by the group’s Brazilian interest TIM Participacoes (TIM Brasil) decreased 3.0% to EUR3.620 billion, and Telecom Argentina weighed in with revenues of EUR1.890 billion, an improvement of 3.7% on an annualised basis. EBITDA for 1H13 was EUR5.236 billion, down 10.6% on the corresponding period in 2012, while the company posted a consolidated net loss of EUR1.407 billion, compared to a net profit of EUR1.242 billion in 1H12.

The company explained that write-downs of non-current assets amounted to EUR2.213 billion in the period under review, and relate primarily to the EUR2.187 billion write-down of the goodwill allocated to the firm’s domestic business unit. In accordance with the specific procedure adopted by the TI Group, the valuation took into account the deterioration in the macroeconomic environment, both in general terms, considering the prospects for the Italian economy, and in specific terms, considering the management’s expectations of the impact – throughout 2013 and for the years to come – of the recent decisions taken by Agcom regarding the prices for wholesale access to the copper network. . Excluding the negative impact of the goodwill write-down, TI claims that net profit for the period will be around EUR800 million.

Franco Bernabe, chairman of the board of directors, commented: ‘The first half of 2013 was affected by the fragility of the domestic economic framework and by the reduced growth of the economy in Latin American countries. In Italy continued pricing pressure was also recorded, in particular on the consumer mobile market, in addition to a significant negative impact deriving from regulatory aspects … As regards the access network spin-off plan having taken note of the Agcom decisions of 25 July concerning its validity and solidity, we confirm our willingness to proceed promptly with the access infrastructure spin-off as approved and announced on 30 May’.

Italy, Telecom Italia (TIM)