Telecom Italia posted improved results for the first half of the year this morning, reporting rising revenue and reversing a year-ago loss.

Net income in 1H12 came in at EUR1.25 billion compared to a EUR2.04 billion loss a year ago, a period which included a substantial write-down of the operator's domestic business. Six analysts surveyed by Bloomberg estimated profit of EUR1.19 billion on average. Group sales were up 1.7 percent to EUR14.8 billion.

"The company returned to solid earnings in the first half 2012 despite the worsening of the economic conditions in Italy and the slowdown in Latin America," said CEO Franco Bernabe.

"Although the macroeconomic and financial picture does not look likely to improve in the coming months either in Italy or Latin America, we will not allow it to threaten our stated objectives, above all debt reduction,” he added.

“They beat expectations that had been heavily reduced by company commentary, results of competitors and their Brazilian unit where competition is rising and regulation getting tougher,” analyst Robin Bienenstock told Bloomberg.

Domestic revenue (Italy) was down 3.1 percent to EUR9 billion, accounting for 61.2 percent of total sales. In the firm’s other two main markets, Brazilian sales rose 6.7 percent to EUR3.7 billion and Argentina was up 20.6 percent to EUR1.8 billion.