O2’s iPhone deal nudges up profits at parent Telefonica
SPANISH telecoms giant Telefonica said yesterday that it had seen a small increase in first-half profit, as a sharp downturn in its home market was offset by a strong performance in the UK and Latin America.
Telefonica’s UK arm, O2, put in a solid performance over the period – posting year-on-year growth of 6.6 per cent in its customer base to 20.7m users – thanks to its status as Apple’s exclusive iPhone partner in Britain. Revenues at the division rose by 5.5 per cent to €3.19bn (£2.7bn).
“O2 is the only operator in the UK continuing to grow. We are clearly outperforming competitors again,” said O2 UK chief executive Ronan Dunne.
Latin America was once again the group’s dynamo, accounting for almost 40 per cent of revenues, with mobile penetration there still growing.
But second quarter revenues at Telefonica’s Spanish arm fell 6.9 per cent to €4.8bn due to the impact of the country’s bitter recession.
Europe’s biggest telecoms company reiterated its full year guidance, in which it expects a one to three per cent increase in operating profit.
Telefonica’s 2010 target is for earnings per share of €2.30, although some analysts were yesterday sceptical that the group will hit the figure.