January 17, 2019 / 10:04 PM / a year ago

Telecom Italia sees FY organic EBITDA at $9.2 billion

FILE PHOTO: Telecom Italia new logo is seen at the headquarter in Rozzano neighbourhood of Milan, Italy, May 25, 2016. REUTERS/Stefano Rellandini

MILAN (Reuters) - Telecom Italia (TLIT.MI) expects to report full-year organic core earnings of around 8.1 billion euros ($9.2 billion), the Italian phone group said on Thursday after examining preliminary results.

The figure would represent a drop of less than 5 percent compared to the year before, a person familiar with the matter said, despite an improvement in its Brazilian unit. Telecom Italia (TIM) did not give any comparison figures.

TIM has been caught since early last year in a battle between top shareholder Vivendi and activist fund Elliott over how to revive Italy’s biggest phone group, an underperforming business with a hefty debt pile.

The company said on Thursday it expects to report a mid-single digit drop in organic core earnings for its domestic business for last year.

Broadband group Open Fiber is rolling out a rival fiber optic network to TIM’s, while French telecoms group Iliad (ILD.PA) has launched a low-price mobile offer for Italy.

The incumbent’s finances have also been stretched after it bid 2.4 billion euros - much more than initially planned - to secure airwaves in Italy’s fifth-generation mobile auction.

Adjusted consolidated net financial debt is seen at around 25.2 billion euros, TIM said on Thursday. All the operational results have yet to be checked by an external auditor and could still change, it added.

TIM’s board is set to approve final results for 2018 and its business plan for 2019-21 on Feb. 21.

The company said the “competitive dynamics” that impacted its Italian business last year are also expected to influence 2019, especially the first semester.

Reporting by Agnieszka Flak; Editing by Toby Chopra

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