Portugal Telecom to Focus Abroad After Troubled 4Q
LISBON -(Dow Jones)- Portugal Telecom's Chief Executive Henrique Granadeiro said Thursday the company plans to focus on its foreign operations, such as those in Brazil and Africa.
Granadeiro was speaking at the company's earnings press conference, after PT revealed its fourth-quarter net profit had fallen almost 79% on the year to EUR71.8 million, hurt by curtailment costs, higher taxes and a EUR260 million reinforcement of its pension fund.
Granadeiro said 31% of PT's earnings before interest, taxes, depreciation and amortization, or Ebitda, came from abroad in 2007 "and that's the direction we intend to continue pursuing." He said the international growth could happen both by organic growth or via acquisitions.
Brazil's Vivo Participacoes was PT's best-performing business in the fourth quarter, with revenue growing 26% to EUR676.7 million. Vivo is Brazil's largest cellphone company and is jointly owned by PT and Spain's Telefonica.
Granadeiro, who emphasized the fact that Vivo accounted for 40% of PT's revenue in 2007, said the company is interested in continuing to work alongside Telefonica in Latin America.
"Trees are known by their fruits and this partnership is giving excellent fruits at Vivo, and it will even improve," Granadeiro said.
PT, which recently spun off its Internet and cable unit PT Multimedia, hasn't invested heavily in its international operations due to a failed hostile bid for the company in the first quarter of last year, the chief executive said.
"The long bid process caused the company to slow its investment abroad, namely in key markets such as Brazil and Africa," Granadeiro said.
-By Filipa Cunha, Dow Jones Newswires; +351 21 319 1863; filipa.cunha@dowjones.com
(END) Dow Jones Newswires
Posted to the site on 28th February 2008
