Telefonica Czech Republic AS (BAATELEC.PR), a unit of Spain's Telefonica SA (TEF), expects continued sales growth at its Slovak subsidiary to generate a net profit in the second half of the year, slowing the decline in group net profit that was seen in the first half, the company's chief executive said Wednesday.

The Slovak mobile subsidiary's first-half sales growth accounted for almost 100% of growth of that market and generated an operating profit of roughly EUR10 million after posting a loss a year earlier, Luis Antonio Malvido said.

"With our lean operations, growth will be translated into [operating income] and it'll be difficult for our competitors to catch up. It'll show up in profits in the second half," Malvido said.

The company is also focusing on more affluent customers and in July launched sales of 3G mobile services to small enterprises, and the steps are already generating a positive reaction, he said.

Telefonica Czech said the recently launched VDSL high-speed Internet service in the Czech Republic will likely support the data segment and help to narrow sales declines.

Earlier Wednesday Telefonica Czech said its first-half net profit fell 17% annually to 3.61 billion koruna ($215 million).

-By Sean Carney, Dow Jones Newswires; +420 222 315 290; sean.carney@dowjones.com

Go to http://blogs.wsj.com/emergingeurope for the new WSJ and Dow Jones blog on Central and Eastern Europe, covering business, politics, society and more, written by our correspondents across the region.