France Tel bullish despite earnings drop

France Telecom’s earnings slipped 6.2% in the third quarter, as revenue fell in all markets except Spain during the period.
Group EBITDA fell from €4.2 billion in 3Q10 to €3.9 billion in 3Q11 on the back of a 3% slide in revenue to €11.2 billion. The operator blames the revenue fall on lower sales of mobile devices during the quarter, which comes despite growing its overall subscriber base 6.3% to 221 million.
Chief Stéphane Richard notes the operator fared well in emerging markets despite headline figures being dragged down by continuing problems with its Egyptian business, while sales growth in Spain came “despite the economic conditions,” that have mired competitors in that market.
While France Telecom’s stock lifted on the results, that rise seems to have more to do with its results being better than recent figures from rival European incumbents, analysts told Bloomberg.
The operator has raised its full-year forecasts for cash flow to €9 billion, despite a 9.1% year-on-year drop in the figure to €7.8 billion in the nine months to end-September.