Swisscom profits steady

Swisscom reports solid results Keystone Archive

Switzerland's largest telecoms operator, Swisscom, says core profit during the first nine months remained steady, dipping slightly by 0.8 per cent.

Swisscom reported that earnings, before interest, tax, depreciation and amortisation, reached SFr3.4 billion ($2.3 billion).

The decrease was said to be in line with the company’s expectations.

On a more positive note, sales increased by two per cent to SFr10.8 billion, but net profit was down at SFr1.2 billion.

The company said it still expected revenues for the entire year and core profit to grow slightly.

However, Swisscom predicted that net income for 2002 would be “considerably lower” than the figure for 2001.

This was due to continuing pressures on the fixed network and data markets, as well as the lack of one-time gains to its balance sheet for 2002.

Last year’s end-of-year figures enjoyed a one-off boost through the sale of a 25 per cent stake in its mobile communications business to the British company, Vodafone.

Chequered year

The figures were down on the same period last year, when the firm reported a 7.8 per cent rise in operating income.

Thursday’s announcement follows a chequered year for Swisscom which announced a further 450 job cuts as part of a restructuring programme announced two years ago to shed 3,000 posts by 2003.

Net profits for the first six months of 2002 were also substantially down – at SFr780 million.

Swisscom was told in August it could face a SFr1 billion fine for allegedly breaking competition rules.

The Swiss Competition Commission is investigating whether the company broke an agreement not to enclose advertisements in its bills to former customers.

Swiss cash cow

Swisscom is said to be the ninth largest company in the European telecoms market.

It reportedly holds a war chest of some SFr10 billion and is thought to be in a comfortable position in a market, currently subject to adverse conditions.

Swisscom said further acquisitions were not on the cards for the moment and it was more likely to buy back shares.

The majority stakeholder of the company is the Swiss government (62.7 per cent).

swissinfo with agencies