New Zealand top carrier reports 15.5% dip in earnings

New Zealand Telecom posted a 15.5 % fall in full year adjusted profit as increased competition eroded its market dominance and reduced margins.

A Reuters report also quoted New Zealand's incumbent phone provider saying that net profit for the year to June 30 was NZ$713 million (€331 million, US$509 million), compared with an adjusted profit of NZ$844 million (€395 million, US$602 million) last year.

Earlier, Telecom's shares ended flat at NZ$3.68 (€1.7, US$2.67). The shares have lost 15.2% so far this year compared with a 16.4% fall in the benchmark top 50 index of which Telecom makes up about 18%, the Reuters report said.

Telecom's 2007 result was boosted by one-off gains, including just over NZ$2 billion (€930 million, US$1.4 billion) on the sale of its directories arm. Telecom reported a net profit of NZ$3 billion (€1.4 billion, US$2.1 billion) for the year to June 2007.

The company competes in the mobile and some fixed sectors with Vodafone and has limited competition in the domestic fixed-line and internet sectors from TelstraClear.

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