Sales and profits at Telefonica Group were down during the first nine months of 2013, but the Spanish and Latin American giant nonetheless managed to hit its debt-reduction target early, improve operating margins in its home market and deliver organic revenue growth.

Revenues during the first three quarters were €42.6 billion, down 8.4 per cent year-on-year.

Continued pressure in its home market, plus weakening Latin American currencies, took its toll on net profits – down 9 per cent, to €3.12 billion, through January-September.

More encouragingly, organic revenue (which excludes impact of acquisitions) was up a modest 0.4 per cent over the nine-month period.

That’s a turnaround as organic revenue growth was down 0.5 per cent during 1H 2013. The Q3 performance (up 2.1 per cent) was strong enough to haul the nine-month period into positive organic growth territory.

Latin America, which accounted for just over half of group revenues in the first three quarters, was a strong Q3 growth driver – up 10.9 per cent (in organic terms).

In Spain, however, Telefonica is still struggling with regulatory and competitive pressures.

Revenue in its home market fell 14.1 per cent, to €9.76 billion, through the first three quarters. The top-line figures were not helped by a sharp drop in revenue from handset sales (down 55 per cent) due to the removal of subsidies in March 2012.

However, the domestic revenue performance improved relatively in Q3 (down 12.1 year-on-year) mainly due to a lower year-on-year decline in handset sales (down 32.8 per cent in the quarter).

And Telefonica is running a tighter ship at home. The OIBDA (operating income before depreciation and amortisation) margin stood at 50.2 per cent in Q3, up 3.2 percentage points year-on-year.

“The improvement in margins in Spain is quite remarkable,” Borja Mijangos, a Madrid-based analyst at Interdin Bolsa, told Bloomberg.

The sale of assets has also meant Telefonica’s target of pushing net debt below €47 billion by the end of the year has been reached three months early.

As of 30 September, Telefonica was sitting on a net debt pile of €46.1 billion.