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    TIT   IT0003497168

TELECOM ITALIA S.P.A.

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Telecom Italia Shares Drop After 1Q Revenue Disappoints

05/19/2020 | 05:12am EDT

By Cristina Roca

Shares in Telecom Italia SpA fell sharply Tuesday after the company's first-quarter results fell short of analysts' expectations, hit by the coronavirus pandemic.

Revenue for the period fell to 3.96 billion euros ($4.3 billion) from EUR4.47 billion, dragged by shop closures due to the coronavirus lockdown, a product-portfolio rationalization and the introduction of more disciplined commercial policies, Telecom Italia said.

Revenue came below expectations, reflecting continued weakness in the company's main market of Italy, according to analysts at Bryan Garnier and Equita SIM.

At GMT 0840, shares in the Italian telecommunications company traded 6.4% lower at EUR0.36.

Telecom Italia's earnings before interest and taxes for the quarter were lower at EUR533 million compared with EUR683 million a year prior, while earnings before interest, taxes, depreciation, and amortization, or Ebitda, fell to EUR1.74 billion from EUR1.95 billion.

Net profit rose to EUR560 million euros from EUR165 million for the first quarter of 2019, but this was mostly the effect of a EUR441 million gain from the merger of its Inwit business with Vodafone Group PLC's mobile towers.

Telecom Italia said that it has signed a new revolving EUR1.7 billion credit line from a group of banks, to firm up liquidity during the coronavirus uncertainty.

Looking to the future, Telecom Italia expects to preserve its Ebitda and capital expenditure guidance, as well as cumulated 2020-22 equity free cash flow of EUR4.5 billion to EUR5 billion, the company said.

Bryan Garnier analysts said the company's debt reduction outlook is good, but saw its 2020 Ebitda guidance at risk, especially given the hit from the coronavirus.

 

Write to Cristina Roca at cristina.roca@dowjones.com; @_cristinaroca

 

Stocks mentioned in the article
ChangeLast1st jan.
NEXT PLC 0.83% 6534 Delayed Quote.-19.83%
TELECOM ITALIA S.P.A. -2.02% 0.2722 Delayed Quote.-37.31%
VODAFONE GROUP PLC 1.58% 119.68 Delayed Quote.6.61%
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Analyst Recommendations on TELECOM ITALIA S.P.A.
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Financials
Sales 2022 15 614 M 16 244 M 16 244 M
Net income 2022 131 M 136 M 136 M
Net Debt 2022 23 196 M 24 132 M 24 132 M
P/E ratio 2022 -116x
Yield 2022 1,99%
Capitalization 5 682 M 5 912 M 5 912 M
EV / Sales 2022 1,85x
EV / Sales 2023 1,79x
Nbr of Employees 51 893
Free-Float 77,0%
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Technical analysis trends TELECOM ITALIA S.P.A.
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Mean consensus HOLD
Number of Analysts 20
Last Close Price 0,28 €
Average target price 0,34 €
Spread / Average Target 21,0%
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Managers and Directors
Pietro Labriola Chief Executive Officer & Director
Adrián Calaza Chief Financial Officer
Salvatore Rossi Chairman
Michele Gamberini Chief Technology & Information Officer
Stefano Siragusa Chief Revenue, Information & Media Office
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