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Avenir Telecom Profits Slump on Weak European Market

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France based Avenir Telecom, a distributor of mobile accessories and services, has reported that its first half revenues fell by 5.3 percent to EUR211.2 million, while its net profits slumped by 75% to EUR1.8 million.

These results were impacted by the costs associated with the rationalisation of the Internity store network and by the fall in sales of subscription plans. The latter was offset by the rise in sales of smartphones and by the continued development of accessories under licence from Energizer and under the OXO and BeeWi brands, which buoyed the growth in activity in indirect distribution.

Revenues from direct distribution were impacted by the difficult economic situation in Spain, and more generally by the closure of 30 branches of the Internity chain store.

The gross margin of indirect distribution was negatively impacted by an unfavourable product mix associated with the decline in volumes on behalf of telecom operators. 

The company warned that the first half of 2012-2013 should mark a low point in the profitability of the Avenir Telecom Group. The gross margin should benefit in the second half of 2012-2013 from the significant improvement in sales of subscription plans related to Christmas offerings proposed by telecom operators partnering with Avenir Telecom in France and Spain, continued sales of smartphones and the increase in sales of mobile accessories.

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Tags: avenir telecom  France