Telecom Italia

Telecom Italia published its results for the first six months of 2011, which saw it reporting a loss at the bottom line due to a goodwill writedown in its home market. The company reported a net loss of EUR2.01 billion for the first half, compared with a prior-year profit of EUR1.21 billion, on revenue of EUR14.54 billion, up 10 percent from EUR13.22 billion. It wrote-down EUR3.18 billion of goodwill, driven by “the deterioration of the financial markets in terms of trends and interest rates.” Excluding this, the company would have reported a profit of EUR1.17 billion. In a statement, Franco Bernabe (pictured), chairman and CEO, noted that 34 percent of the company’s revenue during the period came from its Brazilian and Argentinean operations. For the full year, the company expects its organic revenue and EBITDA to be “largely stable” compared with 2010. Capex will be around EUR4.8 billion, excluding the results of the planned Italian LTE spectrum auction.

Telecom Italia announced mobile telecoms revenue of EUR3.5 billion for the six months, decreasing by 10.5 percent (EUR412 million) year-on-year, with a smaller decline in the second quarter when compared to the first (12 percent and 7.6 percent respectively). It noted “prospects for further improvement in the second half of the year.” The company also reported a 10.2 percent fall in organic service revenue, again with the first quarter worse than the second (11.7 percent and 8.7 percent respectively). Revenue from TIM Brasil was BRL8 billion, up 16.8 percent year-on-year. Revenue from services was BRL7.21 billion, up 10.4 percent. Revenue from Argentina was ARS8.58 billion, compared with ARS6.72 billion, “thanks to growth of the broadband and mobile client base.” Mobile telephony was the principal source of revenue from this business, accounting for 70 percent of the total. The company serves 17.4 million customers in the country, an increase of 1.1 million during the period, with 30 percent of the total being contract subscribers. Telecom Italia also serves just under 2 million mobile subscribers in Paraguay through its Nucleo business, an increase of 6 percent during the period.