Telecom Italy closed the first semester with a net profit of 29 million euros, a sharp decline compared to the 543 million euros recorded in the same period of 2014. The result discounts, in addition to non-recurring expenses for 399 million, the negative impact of the buyback operations of the bonds of the half-year, as well as some items of a purely valuation and accounting nature which do not generate any financial settlement, connected in particular to the fair value measurement of the implicit option included in the bond loan with mandatory conversion issued at the end of 2013, with a three-year duration.
In particular, non-recurring charges are of various types: "charges deriving from corporate reorganisation-restructuring processes, charges resulting from disputes and regulatory sanctions and liabilities related to the aforementioned charges and charges for disputes with former employees and liabilities with customers and/or suppliers", indicates the note, underlining how, in the absence of these impacts, "the profit would have been over 650 million euro".
I revenues they amounted to 10.097 million euros, down by 4,3% compared to the first half of 2014 (-454 million euros). In terms of organic change, calculated excluding the effect of changes in exchange rates and the scope of consolidation, consolidated revenues are down by 3,3% (-347 million euros).
“The results of the second quarter of the year – commented the managing director, Marco Patuano – show a solid improvement trend in turnover in Italy, which grew by 113 million euros compared to the first three months of the year with increases in both the fixed and mobile segments. Tim confirmed once again to be the leading mobile operator in the country, with a 21,8% increase in revenues from innovative services compared to 2014".
As for the "fixed ultra-broadband – he added – clearly shows the benefits of the agreements we are signing with content providers, with an increase in connection demand. Industrial margins also continued to improve, while the absolute figure discounts non-recurring factors and technical provisions linked to regulatory and legal issues still pending for which we are confident we will reach positive solutions".
Furthermore, according to the manager, "the underlying domestic Ebitda result - excluding the impact of both non-recurring charges and other exceptional elements - shows a trend of sequential improvement, with a decrease in the second quarter of 2015 of 2,7% on an annual basis, in recovery compared to that recorded in the first three months of the year (-4,8%)”.
In fact, the company note reads that “the domestic market, in the first half of 2015, confirmed the trend of progressive recovery on a quarterly basis in domestic turnover, with a minor decline compared to previous quarters, thanks to the attenuation of the contraction dynamics of traditional services and the development of innovative services”.
The note also recalls that at the end of 2014 Telecom Italia launched a real estate project, which envisages a process of restructuring, closing some properties and renegotiating leases with the related properties, in a logic of efficiency and savings, mainly achieved through the extension of contractual deadlines and the reduction of lease payments.
The renegotiation and/or stipulation of new contracts, together with a different accounting treatment, resulted in an impact on the balance sheet at June 30, 2015 of 676 million euros in terms of higher tangible assets and related payables for finance leases.
Finally, the press release underlines that the process of listing of Inwit ordinary shares, which involved the sale of the minority stake equal to 36,33% of the ordinary shares (to which was added the sale of 3,64% relating to the shares subject to the exercise of the greenshoe option in July) and a collection , already net of ancillary charges, of 784 million euros.
Plus the group Tim Brazil concluded the sale of the first block of telecommunications towers (4.176 sites) to American Tower do Brasil. The transaction involved the collection of 1.897 million reais (equal to approximately 585 million euros) and the simultaneous opening of a finance lease contract (IAS 17) on the portion of the towers used by the Tim Brasil group itself, with the recognition of a financial debt of 977 million reais (equal to approximately 301 million euro). A capital gain, already net of accessory charges, of 918 million reais (approximately 277 million euro) was recognized in the income statement.
About an hour after the opening of the Stock Exchange the stock of Telecom Italia earns 0,25%, a 1,224 euro.
