Swisscom reported a 13 per cent fall in second-quarter net profit, slightly below forecasts, despite profit at its Italian subsidiary Fastweb.
But the telecoms group confirmed its 2008 forecast for revenue of around Sfr12.3 billion ($11.32 billion) and operating income of around Sfr4.8 billion.
Net profit fell to Sfr412 million, while revenue was 12.5 per cent higher than a year ago at Sfr3.06 billion, still boosted by Swisscom's €3 billion acquisition of broadband operator Fastweb, the Swiss group said today.
The average forecast for net profit was Sfr448 million and Sfr3.02 billion for revenue.
Fastweb, which Swisscom bought in 2007 to counter lacklustre growth at home, posted a profit of €25.9 million in the second quarter.
Swisscom said provisions set aside for the early termination of around 75 per cent of the long-term leasing agreements reduced net income by Sfr99 million after tax in the second quarter.
Swisscom said in its home market, where it faces price pressures and tougher competition, revenues inched down slightly in the first-half of 2008.
Swisscom shares have fallen 18 per cent this year, outperforming the European sector index, but at 9.5 times forecast 2009 earnings it is still trading at a 5 per cent discount to peers due to its limited growth prospects.
Reuters