Telecom Italia's 1st Half Net Profit Reaches 1 Billion Euros -- Update
July 26 2016 - 3:54PM
Dow Jones News
By Manuela Mesco
MILAN--Telecom Italia (TI) said Tuesday its first-half net
profit reached 1 billion euros ($1.1 billion) as the company
benefited from the effects of a convertible bond issued in
2013.
The largest Italian telecom operator said that without such
accounting effects, net profit would be almost flat on the
year.
A change in the company's shareholding structure, now dominated
by French media group Vivendi SA (VIVEF), saw the introduction of
new executives. Chief Executive Marco Patuano left over clashes
with the French firm's executives on Telecom Italia's board and was
replaced by Flavio Cattaneo in March.
Vivendi, in the meantime, pushed for stronger cost-cutting
measures and a resolution to issues at Telecom Italia's
underperforming Brazilian unit.
On Tuesday, Telecom Italia said that it's simplifying processes
and controlling costs in Italy. It aims at reaching a total of
EUR1.6 billion in cost savings by 2018. The company is also looking
at cutting costs at its Brazilian unit.
Telecom Italia said first-half revenue was down 9.9% on the
year, at EUR9.1 billion, as its Brazilian business weighed on
overall performance.
The Italian market, which accounts for nearly 80% of overall
revenue, saw revenue fall 1.7% on the year, but Telecom Italia
stressed the decline is slowing.
It revised its outlook upward for the year, saying it now
expects low-single digit growth in domestic Ebitda for the year.
The company previously said its domestic Ebitda would stabilize
this year.
Earnings before interest, tax, depreciation and amortization was
up 2.4%, at EUR3.7 billion.
Write to Manuela Mesco at Manuela.Mesco@wsj.co
(END) Dow Jones Newswires
July 26, 2016 15:39 ET (19:39 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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