By Stelios Bouras
ATHENS--Greece's dominant phone company, Hellenic
Telecommunications Organization SA (OTE), reported Wednesday a
sharp drop in first-quarter earnings, as mobile revenue in Greece
fell and operations in Albania and Bulgaria remained under
pressure.
The company said net profit was 40.4 million euros ($45.3
million), down from EUR55.8 million a year ago. Revenue for the
same period eased 2.4% year-on-year to EUR940.8 million.
Adjusting for charges stemming from its voluntary retirement
scheme and an extra tax charge, net income was off 6.3% on the year
at EUR53.9 million.
In a statement, OTE Chief Executive and Chairman and Michael
Tsamaz said fixed line revenue in Greece rose in the three month
period, the drop in Greek mobile revenue slowed, while cuts to
termination rates hurt OTE's units in Romania and Albania.
"Our cost discipline, strong operating profitability and cash
flow generation enabled us to sustain considerable investments in
our networks and service offering during the quarter while
preserving a particularly healthy financial structure. We expect
these trends to continue throughout the year," said Mr Tsamaz.
The company, Greece's one-time state-owned monopoly phone
company but now a unit of Deutsche Telekom AG, has faced slowing
revenue due to Greece's protracted economic crisis as well as
weakening demand in its key markets in southeast Europe. At the
same time, it has also had to contend with stiff competition in its
core Greek mobile market from its two domestic rivals-Vodafone
Greece and Wind Hellas.
Write to Stelios Bouras at Stelios Bouras@wsj.com
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