Spain's Telefonica has reported its fourth quarter financial results as the company topped analyst expectations thanks to cost cutting efforts and debt reduction.
Fourth quarter profits more than tripled over the past year, although that was mainly due to write-offs last year not being repeated again.
The company posted net profits of EUR1.45 billion (US$1.98 billion) as compared to a profit of EUR473 million a year ago. Analysts had expected a profit of around EUR1.2 billion.
Revenues however fell by just under 9 percent to EUR14.43 billion, mainly due to currency fluctuations. Sales at its Latin American division would have risen by 10 percent without the currency changes.
Net debt also fell to EUR45.4 billion, below its self-imposed target of cutting it to EUR47 billion. The company also said that it would now slow down the debt repayment to EUR43 billion this year, which indicates that it might be looking at some acquisitions in the expected consolidation of the European telecoms market.
Yesterday, the company said it would cut costs by another EUR1.5 billion, although the timeframe for that was not specified.
Telefónica's Chairman, César Alierta, pointed out that the Company will accelerate its transformation in 2014: "Among our targets, we will continue accelerating revenue growth and, at the same time, we will increase investments to anticipate to the growing demand from the increasingly intensive data service usage, as well as the recovery of demand expected in some of our main markets".
Telefonica ended the year with a global customer base of 323.1 million, up by 2% over the year. Of the total, 254.7 million are mobile subscribers.
The company has a stock market market capitalization of around EUR52 billion.
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