COVID-19 hits TIM Group sales but net profit jumps; cellco plans to fight competition lawsuit

19 May 2020

Telecom Italia Group (TIM Group) recorded revenues of EUR3.96 billion (USD4.3 billion) in the first three months of 2020, down 11.3% year-on-year as reported, or a drop of 8.4% on an organic basis. Domestic turnover fell 11.1% on a reported basis and 10.6% like-for-like to EUR3.11 billion, while sales from Brazil were down 12.3% as reported and up 0.6% on a comparable basis at EUR859 million. Group EBITDA dropped 10.8% (7.5% organic) to EUR1.74 billion, and net profit jumped 216% y-o-y to EUR591 million, with the increase attributed to the EUR441 million net capital gain recorded following the merger of tower subsidiary INWIT with the tower business of Vodafone Italy.

In a statement the group noted the negative effect of the COVID-19 crisis: ‘The financial results have been impacted by the effects of shop closures and therefore product sales, and by reduced roaming traffic to and from abroad. However, in contrast to a short-term downturn, the medium-long term outlook is positive.’

TIM Italy had 20.4 million mobile customers at the end of March, plus a further 10.1 million M2M connections. The firm also counted 7.6 million retail fixed broadband subscribers at the same date. TIM Brasil, meanwhile, had 52.8 million mobile customers at the end of March, down 4.1% in twelve months.

Separately, TIM Group’s financial report notes that it is being sued by Italy’s newest mobile network operator, Iliad. The newcomer is suing TIM and its budget sub-brand Kena Mobile for alleged anti-competitive conduct and is seeking at least EUR71.4 million in compensation. TIM has said that it will be challenging the suit in court.

Brazil, Italy, Iliad Italia, Telecom Italia Group (TIM Group)