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Telefonica Q2 Profit Climbs; Upgrades FY17 Revenue View, Backs Margin Outlook

Spanish telecom group Telefonica SA (TDE.L,TEF) Thursday reported that its second-quarter attributable net profit climbed 18.4 percent to 821 million euros from 693 million euros last year. Earnings per share were 0.15 euro, up 16.3% from 0.13 euro a year ago.

Operating income before depreciation and amortisation or OIBDA totaled 4.16 billion euros in the quarter, a growth of 6.1% from last year. The growth was 7.2% organically.

The OIBDA margin stood at 32.1%, an expansion of 1.3 percentage points from last year's 30.8 percent.

Revenues reached 12.96 billion euros in the quarter, up 1.9% from last year's 12.72 billion euros. Revenues increased 3.1 percent organically thanks to improved trends in all segments.

The company noted that both service revenues and terminal sales accelerated year-on-year organic growth.

Mobile data revenues continued to be a key growth driver and improved their pace of growth in the second quarter to 17.8% year-over-year in organic terms.

Looking ahead, for fiscal 2017, the company upgraded its guidance and reiterated the dividend announced for 2017.

For the year, revenue guidance upgraded to growth of above 1.5%, compared to previously expected stable revenues, despite the negative impact from regulation.

Further, the company backed OIBDA margin guidance of year-over-year expansion of up to 1 percentage point.

José María Álvarez-Pallete, Executive Chairman, said, "The strength and better business trends in the first half of the year, as well as being well-positioned to continue capturing sustainable growth in the coming quarters, allow us to upgrade our guidance for 2017.".

by RTT Staff Writer

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