(Adds business plan targets, further details)
By Agnieszka Flak
MILAN Feb 3 Telecom Italia on Friday
posted a better than expected 14.4 percent rise in full-year
core earnings, helped by cost cuts and its domestic operations
returning to growth.
Italy's biggest phone group also said it would spend around
11 billion euros ($11.8 billion) in its home market over the
next three years, with 5 billion euros of the total going on
speeding up the installation of a nationwide ultrafast broadband
Outlining its 2017-19 business plan, the former monopoly
network operator said its fibre optic cables would cover 95
percent of Italy by the end of 2019, while its 4G mobile
broadband network would reach more than 99 percent of the
population by then.
The group, in which French media firm Vivendi holds
a 24 percent stake, also said it was aiming to make 1.9 billion
euros in efficiency savings by 2019.
Chief Executive Flavio Cattaneo, who took over the running
of the heavily indebted group last year, has been seeking to cut
costs and return the business to growth.
The company reported on Friday that core earnings before
interest, tax, depreciation and amortisation (EBITDA) rose 14.4
percent last year to 8.02 billion euros, above analysts'
consensus forecast of 7.98 billion euros, on revenue down a less
than expected 3.5 percent at 19.04 billion euros.
The firm also said annual turnover and domestic EBITDA would
increase for the next three years, with the latter rising at a
low-single digit percentage rate, while the aim is to cut net
debt to below 2.7 times reported EBITDA by the end of 2018.
Adjusted net debt stood at 25.12 billion euros at the end of
December, down from 27.28 billion a year earlier, helped by the
sale of the group's stake in Telecom Argentina and the
expiration in November of a mandatory convertible bond.
The company also expects recovery to continue at TIM
Participações SA, Brazil's second-biggest cellular
network operator and majority-owned by Telecom Italia.
Earlier on Friday TIM Brasil reported a stronger than
expected fourth-quarter operating margin, pushing its shares to
a three-month high.
($1 = 0.9294 euros)
(Editing by Greg Mahlich)