Telecom Italia Swings to Loss for Year -- Update

   By Manuela Mesco

MILAN--Italy's largest telecom operator, Telecom Italia SpA (TIT.MI), said Thursday that it swung to a net loss last year due to several nonrecurring charges.

The company said that without such charges, it would have posted a net profit of about 1.4 billion euros ($1.58 billion), compared with EUR1.35 billion net profit in 2014.

Net loss stood at EUR72 million. Operating profit fell 33% to EUR3 billion, the company added Thursday.

The company has been struggling for years with declining revenue amid steep competition, a harsh economic crisis and a lack of a clear strategy.

Earnings before interest, taxes, depreciation and amortization, or Ebitda, fell 20% to EUR7 billion, pressured by currency fluctuations, the company said in its preliminary 2015 earnings in February.

Without currency movements, Ebitda fell almost 18%, Telecom Italia said in February. Revenue fell to EUR19.7 billion, down 8.6% compared with the previous year. Without the currency effects, it fell 4.6%.

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 that it expects the market to "stabilize" year-over-year in 2016 and expand in 2017 and 2018.

The steep fall in Ebitda is also due to nonrecurring charges for nearly EUR1.1 billion, the company said in February.

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

The telecom operator, which has called its annual shareholders' meeting for May 25, said its board proposed a dividend of EUR2.75 cents a saving share, which amounts to about EUR166 million.

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

(END) Dow Jones Newswires

March 17, 2016 15:57 ET (19:57 GMT)

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