Sonaecom 1Q Losses EUR5.5 Million Vs EUR6 Million

LISBON -(Dow Jones)- Portuguese telecommunications company Sonaecom said early Monday it posted a first-quarter loss of EUR5.5 million compared with a loss of EUR6 million in the same period of 2007.

In a filing to the Portuguese stock market regulator, Sonaecom said its consolidated revenue totaled EUR237.7 million in the first quarter, a 20% increase on the year, mainly due to its wireline and mobile businesses.

Sonaecom's earnings before interest, taxes, depreciation and amortization, or EBITDA, rose marginally by 0.2% to EUR34.1 million in the first quarter.

The company also said its mobile customer base increased by 11.3% to 2.927 million customers at the end of the first quarter, compared with 2.629 million at the end of the first quarter of 2007 and with 2.893 million at the end of 2007.

Wireline revenue for the first quarter grew 39.2% to EUR75.2 million from a year ago.

Sonaecom has fully consolidated last year's acquisition of the Portuguese assets of Swedish telecommunications operator Tele2 and the fixed-line assets of Oni.

"The first quarter has highlighted the significant competitive pressures that the Portuguese telecoms market is under, with all the main operators already active in, or planning to enter, all key segments of the market," Sonaecom Chief Executive Angelo Pauperio said in a statement. "Notwithstanding this competitive market environment, we have been able to achieve our objectives to accelerate growth and strengthen market shares during 2008."

He said he expects the company to be able to reach its full-year 2008 targets.

UBS analysts said the main driver for Sonaecom shares is consolidation potential, amidst intense market speculation of a possible merger with ZON Multimedia, the former cable unit of Portuguese telecommunications major Portugal Telecom.

Sonaecom, which failed to take over Portugal Telecom last year, is rated at buy by UBS, with a EUR4 price target. Sonaecom shares Friday closed up EUR0.09, or 4%, at EUR2.32, in an overall higher Lisbon market.

-By Filipa Cunha and Enza Tedesco, Dow Jones Newswires; +351 21 319 1863; filipa.cunha@dowjones.com

(END) Dow Jones Newswires

Posted to the site on 5th May 2008