France Telecom 1Q07 results

France Telecom said its 1Q07 revenues were €12.8bn, up 1.8%. Results are slightly better than expected by analysts. Gross margin grew 2 points to 36%+ (or €4.7bn), fixed-line revenues are stable for the first time in several quarters, and execution is performing well (sales expenses are down 3%) can explain the good results. Fixed revenues amounted to €5.6bn (+0.2%) in spite of main lines declined by 7% to 24.8m. Mobile revenues grew 4.5% to €6.9bn. The Enterprise division reported revenues of €1.9bn (down 1.5%, but decline is slowing). FT reports more than 100m (+15%) mobile subscribers worldwide, of which 7.3m in mobile broadband (3G and EDGE); 2.6m VOIP subscribers, 6.3m ADSL customers in France; 745k IPTV subscribers (+29%).

FT said it has ruled out any move toward taking a stake in Telecom Italia, but still could partner with TI in some cases. France Telecom stuck to its guidance for 2007.