Telecom Italia Profit Falls as Revenue Continues to Slide -- Update

(Rewrites adding detail and background from second paragraph.)

By Manuela Mesco

MILAN--Italy's largest telecom operator Telecom Italia (TIT.MI) said Tuesday that its profits and revenues continued to fall in 2015.

The company, which plans to invest 12 billion euros ($13.5 billion) in the country over the next three years, said its earnings before interest, taxes, depreciation and amortization, or Ebitda, fell 20% to EUR7 billion, pressured by currency fluctuations. Without currency movements, Ebitda fell almost 18%.

The operator's domestic market--which accounts for nearly 80% of total Ebitda--also fell 20% compared with the same period a year earlier. However, Telecom Italia said when presenting its 2016-2018 business plan, it expects the market to "stabilize" year on year in 2016 and grow in 2017 and 2018.

The steep fall in Ebitda is due to non-recurring charges for nearly EUR1.1 billion, the company said.

Preliminary revenue for 2015 fell to EUR19.7 billion, down 8.6% compared with the previous year. Without the currency effects, it fell 4.6%.

The company, whose revenue has been falling for years, said it noted a stronger recovery, particularly in the mobile sector of its domestic market, compared with previous quarters. Yet, domestic revenue, accounting for 76% of the total, fell 2.3% in 2015.

The investments outlined in the company's new plan aim at strengthening its market position in Italy by reaching almost the entire population of the country with its mobile and fiber networks by 2018.

In Brazil, the company's secondary market, revenues fell 12.1%. Telecom Italia said it plans to invest a total of 14 billion reals ($3.49 billion) in this region to develop further network infrastructure.

The company's 2015 net debt rose to EUR27.3 billion.

At 0904 GMT, shares are down 2.3% at EUR0.86.

Write to Manuela Mesco at manuela.mesco@wsj.com

(END) Dow Jones Newswires

February 16, 2016 04:20 ET (09:20 GMT)

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