Telefónica has recorded a net profit of 502 million euros in the third quarter of the year, 9.3% more than in the same period of the previous year. But the turnover has stagnated at 10,321 million, 0.2% less, due to the drop in income in Argentina, according to the results published this Wednesday by the company shortly before disseminating its new strategic plan for the period 2023-2026. The operator continues the path of debt reduction, which stands at 26,537 million, 942 million less, and has confirmed its forecasts for the year as a whole, which were already revised upwards in July.
The group has also reaffirmed its commitment to pay this year a dividend of 0.30 euros per share (0.15 euros will be paid on December 14 and another 0.15 in June 2024), a remuneration policy for shareholders that it will maintain in the strategic plan, submitted this Wednesday to the judgment of the markets at the first Investor Day organized by Telefónica in a decade. This meeting is being held at a difficult time for the group, both due to the entry into the capital of the Saudi state operator STC and the possible entry of the State, through its industrial arm (SEPI), 26 years after it was totally privatized.
In the accumulated period between January and September, net profit has fallen 15% compared to the same period last year, to 1,262 million, while income has risen 2.4%, to 30,499 million. The company explains the decrease in profits due to the effect of the capital gains achieved in Colombia in 2022, which have been negatively impacting the year-on-year comparison of this year since the first quarter. The operating result before depreciation (Oibda) has stagnated in the first nine months of the year, up to 9,595 million, although it recovered 2.5% in the third quarter, up to 3,330 million.
The company has also confirmed its forecasts for the year as a whole. After presenting the results for the second quarter, and improving revenues for the fifth consecutive quarter, Telefónica announced an improvement in the financial goals established for the whole of 2023: the revenue target was doubled to anticipate organic growth of 4%, while the new objective for the operating result before depreciation (Oibda) pointed to an organic increase of 3%, in the highest range of the forecasts announced at the beginning of the year. The goal of placing the investment ratio at around 14% remained unchanged.
Cash generation has improved throughout the year: 1,130 million euros in the third quarter and a total of 2,426 million in the accumulated year.
Tech Growth
The digital services unit, Telefónica Tech, recorded an increase in revenue of 14.4% year-on-year in the quarter, up to 442 million euros, and of 30% in the accumulated year-to-date, up to 1,327 million. Telefónica Infra, through the different fiber vehicles, present in Spain, Germany, the United Kingdom, Brazil, Chile, Colombia and Peru, has reached a total of 20 million past real estate units (UUII, homes, premises and offices). Telxius, the group’s submarine cable business, closed the period between January and September with a 17% increase in traffic.
By markets, income from Spain grew by 1% in the third quarter, up to 3,151 million; in Germany they improved by 2.2%, up to 2,131 million; in Brazil they rose 6.8%, to 2,467 million, while in Hispam, which groups the rest of the subsidiaries in Latin America, they fell 10.8%, to 2,238 million.
Network and clients
In terms of ultra-fast broadband, Telefónica has reached a total of 171.2 million real estate units passed, of which a total of 70.3 million correspond to fiber to the home (FTTH) networks, 13% more in year-on-year terms. As of September 30, 5G mobile technology coverage reached 87% of the population in Spain, 92% in Germany, 49% in the United Kingdom and 42% in Brazil.
The total customer base grew by 0.3%, to 384.8 million accesses, with increases in high added value segments of 14%, in the case of FTTH accesses, and 3% in mobile contracts.
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