France Telecom 2006 results

Publié le par Jean Arnal

FT posted 2006 results. 2006 net profit was down 27% to €4.1bn, on revenues of €51.7bn, up 1%. Results are in line with latest forecasts. The drop in profit is due to restructuring and impairment charges, and pricing pressure. The good news is that broadband services are now counteracting a decline in traditional voice. FT has turned to high-growth markets, such as IPTV (590k customers), VOIP (with 35% of its customers are using VOIP and 2.5m users), or VOD or content; as a result, multiplay contracts revenues doubled in 2006 and accounted for 41% of the operator's total ADSL ARPU. France is leading Europe in broadband, triple play, and IPTV services. FT CEO sees re-allotting differently its capex between fixed and mobile: less mobile capex because of network sharing (UK and Spain) and more fixed capex in FTTx (the launch is always planned in 2008), but the total would remain at 13% of revenues. Revenues from emerging markets increased by almost 19% while revenues from Western European countries decreased almost 1%. Net debt was €42bn, down 12%. FT confirmed its 2006 dividend of €1.2 (+20%).

FT announced it is sticking to its guidance, a positive news among a concert of profit warnings and drops in revenues. On its strategy, FT announced also its intent to add operations in emerging markets, specially in Africa and Asia, but did not rule out any acquisition in Europe. It may also consider some non-core asset disposal.

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