Q1 sales up 8.5% at Telecom Italia; Vivendi takes two-thirds of board

5 May 2017

Telecom Italia, which offers services in Italy and Brazil under the TIM brand, has reported an 8.5% year-on-year rise in profits for the first three months of 2017 to EUR4.82 billion (USD5.17 billion). The bulk of the growth (EUR284 million) was attributed to the recovery in Brazil, though there was also 2.8% sales growth registered in Italy. First quarter EBITDA climbed from EUR1.71 billion last year to EUR1.99 billion in 2017, though profit attributable to shareholders dropped from EUR433 million in Q1 2016 to EUR200 million in the most recent period, due in part to net non-recurring charges of EUR115 million.

Although mobile subscriber numbers continue to fall in both Italy and Brazil, mobile service revenues showed positive annual growth in both countries. There were 29.42 million wireless customers in Italy at the end of March 2017, down 1.4% y-o-y, while the Brazilian total fell from 67.27 million to 61.87 million.

Separately, Telecom Italia’s biggest shareholder, Vivendi of France, has succeeded in having ten directors appointed to the telco’s 15-member board, tightening its grip on the Italian operator. Vivendi CEO Arnaud de Puyfontaine was top of the French firm’s list of candidates, and had been thought likely to become Telecom Italia’s chairman, though Reuters reports that the current holder of that post – Giuseppe Recchi – is now expected to retain the chair. Italian regulators recently ordered Vivendi to reduce its influence at either Telecom Italia or local pay-TV group Mediaset, though Vivendi has approached the EU to appeal the decision.