Telecom Lead Europe: Telecom Italia’s Capex (Capital expenditure) decreased 3.1 percent to €878 million in the first quarter of 2013.
Italy’s largest mobile phone service provider says the decline did not impact the deployment of next-generation networks.
The €878 million Capex includes an increased weight of its innovative component.
“This area would be managed carefully in 2013 as we confirm our continued commitment to invest in both mobile and fixed technologies. We need to properly calibrate the timing and future deployment also as a function of the take-up of new related services,” said Telecom Italia Chairman and CEO Franco Bernabè.
Telecom Italia will spend €5.1 billion as Capex in 2013. This means there will be a dip in this year’s telecom investment from 2012’s €5.2 billion.
Telecom Italia’s revenue in the first quarter decreased 8.1 percent to €6.79 billion as consumers cut spending on phone services.
Operating income before taxes, depreciation and amortization fell 10 percent to €2.67 billion.
Net income fell to €364 million in the period from €605 million a year earlier.
Revenue in Italy fell to €4.02 billion from €4.48 billion. Revenues from Brazil and Argentina were dampened by negative currency effects
The Italian mobile unit TIM reported service revenues down 17.9 percent from a year earlier to €1.292 billion, hit by price erosion, termination rate cuts and the weak economic environment. TIM lost 301,000 customers in the three months, to finish March with a total 31.858 million lines. Minutes of use rose slightly to an average 167 per customer per month, but the intense price competition led to a 17.3 percent annual fall in ARPU to €13.1. Handset sales more than halved compared to Q4, to 775,000.
At the Italian wireline business, revenues were down 7.7 percent from a year earlier to €2.976 billion. Another 201,000 fixed lines were lost in the quarter, for a total 13.777 million, and retail broadband lines dropped by 36,000 compared to December to 6.984 million. Broadband ARPU was still up 3.5 percent year-on-year to €18.9.
Meanwhile, Telecom Italia directors authorized an in-depth review of a possible combination of the company’s mobile-phone business with Hutchison Whampoa’s Italian unit.
