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MarketScreener Homepage  >  Equities  >  Italian Stock Exchange  >  Telecom Italia S.p.A.    TIT   IT0003497168

TELECOM ITALIA S.P.A.

(TIT)
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Telecom Italia Shares Rise After Results, Single Network Progress

08/05/2020 | 07:32am EST

By Mauro Orru

 

Telecom Italia SpA's shares rose Wednesday after it posted better-than-expected results for the second quarter and raised the prospect of a possible decision on creating a single national broadband network at the end of August.

At 1115 GMT, Telecom Italia shares traded 5.7% higher at EUR0.39.

The Italian telecommunications company said second-quarter net profit contracted to 118 million euros ($139.3 million) from EUR386 million in the second quarter of 2019. The company recorded EUR69 million in non-recurring charges attributable to the coronavirus pandemic in Italy in the first half.

Earnings before interest and taxes dropped to EUR509 million from EUR1.20 billion, while earnings before interest, taxes, depreciation, and amortization fell to EUR1.66 billion from EUR2.45 billion.

Quarterly revenue fell to EUR3.80 billion from EUR4.52 billion amid reduced footfall in shops during lockdown and lower tourist flows, which harmed roaming traffic volumes.

Domenico Ghilotti, analyst at Italian investment bank Equita Sim, pointed out results were slightly above expectations, with domestic revenue declining 10.7% for the first half of the year instead of 11.8% as expected.

However, "the main focus will be on the progress around the creation of the single network in Italy, as the government reportedly intervened during the board meeting to convince both Telecom Italia and KKR & Co. to postpone the decision for the partial sale of the network to the end of August," said analysts at U.S. bank Citi.

KKR previously submitted an EUR1.8 billion offer to be Telecom Italia's exclusive partner in fiber-network development and take a 37.5% stake in its fixed network. However, the Italian telecommunication company is also looking at possible forms of integration between its own and wholesale operator Open Fiber's optical-fiber networks. Open Fiber is a 50:50 joint venture between Enel SpA and Italian state lender Cassa Depositi e Prestiti.

Citi analysts said the Italian government's intervention showed its commitment to establishing a single network--a national broadband grid--as Telecom Italia has extra time to secure a merger with Open Fiber on good terms.

"The single network project has a sharp acceleration and finally a more certain timing," said Mr. Ghilotti.

 

Write to Mauro Orru at mauro.orru@wsj.com; @MauroOrru94

 

Stocks mentioned in the article
ChangeLast1st jan.
ENEL S.P.A. -0.60% 8.32 Delayed Quote.18.35%
KKR & CO. INC. 2.61% 38.92 Delayed Quote.30.03%
TELECOM ITALIA S.P.A. -0.05% 0.3923 Delayed Quote.-29.46%
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Financials
Sales 2020 16 002 M 19 308 M 19 308 M
Net income 2020 1 036 M 1 250 M 1 250 M
Net Debt 2020 23 180 M 27 970 M 27 970 M
P/E ratio 2020 7,96x
Yield 2020 2,88%
Capitalization 8 454 M 10 190 M 10 201 M
EV / Sales 2020 1,98x
EV / Sales 2021 1,90x
Nbr of Employees 52 464
Free-Float 72,1%
Chart TELECOM ITALIA S.P.A.
Duration : Period :
Telecom Italia S.p.A. Technical Analysis Chart | TIT | IT0003497168 | MarketScreener
Technical analysis trends TELECOM ITALIA S.P.A.
Short TermMid-TermLong Term
TrendsBullishNeutralNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 24
Average target price 0,50 €
Last Close Price 0,39 €
Spread / Highest target 98,8%
Spread / Average Target 28,7%
Spread / Lowest Target -41,4%
EPS Revisions
Managers
NameTitle
Luigi Gubitosi Chief Executive Officer & Executive Director
Salvatore Rossi Chairman
Stefano Siragusa Chief Operations Officer
Giovanni Ronca Chief Financial Officer
Michele Gamberini Chief Technology & Information Officer
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