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(Adds details of earnings, comments from executives)
SAO PAULO, May 9 (Reuters) - Telefonica Brasil SA reported a 13 percent rise in recurring net income on Tuesday, citing rigorous cost controls and accelerating demand for mobile and data services despite a sluggish economic recovery.
Excluding one-time revenue from tower sales a year earlier, profit at the Brazilian division of Spain's Telefonica SA rose in the first quarter to 996 million reais ($313 million), according to a securities filing. Including last year's tower sales, net income fell 18 percent.
"In tough times we've managed to grow," said Chief Executive Eduardo Navarro. "As the economy recovers the expectation is that this trend should gain strength."
Net revenue rose nearly 2 percent to 10.590 billion reais, lifted by 5 percent mobile services revenue growth, the best in seven quarters, according to investor relations head Luis Plaster.
Clients migrating from copper landlines to fiber optic connections also helped to boost fixed broadband revenue by 11 percent despite just 2 percent growth in the subscriber base.
Operating costs declined 1 percent on a recurring basis, falling for the fifth straight quarter due to personnel cuts and administrative expense controls.
Capital spending fell 11 percent from a year earlier to 1.328 billion reais, or just 17 percent of the average annual target in a three-year investment plan. Navarro said investments should accelerate in the rest of the year to meet forecasts.
Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 7 percent on a recurring basis to 3.514 billion reais, or 33.2 percent of net revenue. Including the effect of last year's tower sales, EBITDA fell 7 percent.
$1 = 3.18 reais Reporting by Brad Haynes; Editing by Dan Grebler and Bill Trott