Telecom Italia agreed a €1.2 billion joint venture with fixed operator Fastweb, as the country’s incumbent hailed its “best quarter in Italy since 2009”.

The joint venture with Fastweb will speed the rollout of a fibre-to-the-home network in 29 Italian towns and cities. This excludes Milan and cities already covered by TI and Fastweb with FTTH.

The alliance will enable the partners to go “faster and deeper” than operating singly, said TI.

TI is to hold an 80 per cent of the venture with Fastweb taking the remaining 20 per cent.

A source told Reuters that the venture is open to other commercial partners, although not equity investors.

Flavio Cattaneo, CEO, heaped praise on the ailing operator’s Q2 performance: “In Italy, Telecom has recorded the best quarter since 2009 demonstrating that the actions taken to date are bringing significant results”.

“The organic EBITDA has started to grow again on both quarterly and half year basis, the turnover of the mobile segment has improved its development trend and the landline segment has shown important signs of recovery, pulled along by investments in ultrabroadband,” he added.

Yet “best quarter” is a relative term. Viewed organically, revenue in its home market decreased by 1.1 per cent year-on-year to €3.7 billion, although this was less than previous quarters. And organic EBITDA in Italy was up by 6.9 per cent year-on-year to €1.7 billion.

Domestic wireless revenue grow to €1.26 billion compared to €1.24 billion in Q2 2015, as the results of improvements in ARPU, churn and LTE penetration. The operator said its high-quality LTE network will support further revenue growth growth in 2016.

On a group level, Q2 2016 reported revenue of €4.66 billion was down 7.7 per cent from €5.05 billion in the year ago quarter. EBITDA was €2 billion, up 25.4 per cent.

For the six months, the company reported a profit attributable to shareholders of €1 billion, compared with €33 million last year, although this was impacted by “some items of a purely accounting and valuation nature”. Excluding this, the figure would have been basically flat at €650 million.

H1 revenue of €9.1 billion was down 9.9 per cent, mainly due to TI’s Brazilian operation.