Telecom Italia's losses narrow by 13%
EmptyROME -- Telecom Italia Media said Thursday that its losses narrowed by 13% in 2007, boosted by robust local advertising sales that bucked the trend for the television sector as a whole.
The company is the media arm of former state telephone monopoly Telecom Italia. It owns La 7 -- the only national television network not owned by state broadcaster RAI or Silvio Berlusconi's Mediaset -- as well as several niche networks, such as MTV Italia and Comedy Central-Italia.
In a conference call with journalists and analysts, Telecom Italia Media officials were upbeat about the results, which were presented after the Italian Stock Exchange closed Thursday.
The company's shares finished 2.5% higher on speculation of strong results, continuing an up-and-down week for the shares. On Tuesday, the shares climbed nearly 5% on speculation that it could be spun off from Telecom Italia or sold, and then were down 2.1% on Wednesday when the company said no sales plans were in the works. Volume all week has been three times its normal level.
On Thursday, the company said it lost 88.1 million euros ($131.3 million), 13% smaller than the 101.1 million euros ($150.6 million) recorded in 2006. The improvement was on the back of strong revenue, which surged to 263.1 million euros ($392 million), a 27% jump compared with 207.5 million euros ($309.2 million) a year earlier.
The revenue growth is in line with the company's early 2007 forecast of around 25% revenue growth per year. But more of the same is unlikely, officials said.
During the conference call, they cautioned that the growth in ad sales should slow this year in part because of "the lack of a clear-cut regulatory framework within the sector." That environment resulted in the company pushing back its forecast for its first pro forma profit to "2009 or perhaps 2010" -- a threshold the company said a year ago it would reach this year.
Afterwards, analysts predicted the shares would slide lower on Friday because of the weak outlook.