France Telecom Full-Year Profit Down 35% on One-Off Gains

France Telecom has reported a drop in full-year profits of 35% compared to last year, when its earnings were boosted by a one-off tax gain. Sales rose to €53.5 billion (US$67.4 billion), while net income fell to €4.07 billion (US$5.1 billion) from €6.3 billion a year ago. Net debt was €35.9 billion (US$45 billion) as of 31 December 2008, a reduction of €2.1 billion year on the year.

Profit had been seen at €5.31 billion on sales of €53.4 billion - based on analysts' average estimates compiled by Bloomberg.

The company also reported a 7% increase year on year in the total number of customers with 182.3 million customers at 31 December 2008, including 121.8 million mobile customers, up 11%, and 12.7 million ADSL broadband customers, up 9%

The company says that it is maintaining CAPEX rate for 2009 of between 12% and 13%, but warned that if the deterioration in the economic environment intensifies, investments could be reduced

Commenting on the results for the year, Didier Lombard, France Telecom Chairman and Chief Executive Officer, stated: " These results show that the Group is well armed to face an economic environment that has been particularly unsettled. We are able to continue generating a high level of cash flow, necessary to ensure future investments and for our employees and shareholders to be able to partake in the Group's successes."

"For 2009, based on the current economic outlook, the Group's objective is to generate €8 billion in cash flow and to maintain a level of investment at about 12% to 13% of revenues. This could be reduced if the economic downturn intensifies. Nonetheless, we remain confident of our ability to maintain growth at a rate that exceeds that of the economies of countries where we operate."

Posted to the site on 4th March 2009