Telefonica touts positive trends - Mobile World Live

Telefonica touts positive trends

10 MAY 2019

Telefonica pointed to a significant improvement in revenue growth trends during Q1, with all regions registering organic growth, although in report terms its figures were less rosy.

Revenue of €11.98 billion was down 1.7 per cent year-on-year, although the operator pointed to organic growth of 3.8 per cent. Service revenue of €10.7 billion was down 3.1 per cent, or up 2.6 per cent organically.

Exchange rate fluctuations negatively affected the company, mainly due to depreciation of the Brazilian real and Argentine peso against the euro.

Net income of €926 million was up 10.6 per cent.

Jose Maria Alvarez-Pallete, CEO (pictured), said: “We have started the year by extending our leadership in fibre and 4G deployment, testing new 5G capabilities and making progress in the UNICA virtualisation programme, allowing us to continue gaining customer relevance through better experience and higher average lifetime.”

Net debt decreased by €693 million in the quarter to €40.4 billion, due to cash generation and the sale of Antares and Telefonica Guatemala. There were other factors negatively affecting debt, including shareholder remuneration and labour-related commitments.

Markets
Revenue in Spain increased 0.3 per cent to €3.1 billion, as an increase in service revenue offset declines in handset sales. In Germany, revenue increased 0.7 per cent to €1.8 billion, supported by strong consumer demand for handsets.

UK revenue increased 5.3 per cent on an organic basis to €1.7 billion, attributed to the success of flexible tariff plans; higher value handset sales; and growth in its smart metering implementation programme, MVNO and business ICT operations.

Separately, the UK arm announced a “multi-million pound network collaboration” with independent wireless infrastructure operator WIG intended to improve coverage in public spaces including stadiums, shopping centres, hotels and conference centres.

Revenue in Brazil increased 1.7 per cent on an organic basis to €2.6 billion, although in reported terms there was a decrease due to currency movements. Regulatory changes also had an impact.

For Telefonica’s Southern LatAm unit, revenue increased 15.2 per cent on an organic basis to €1.6 billion, although again there were losses on a reported basis. Northern LatAm revenue of €971 million was up 1.2 per cent (flat in reported terms).

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