Swisscom First-Quarter Profits Down, Lower Margins, Higher Costs

Swisscom reported a below consensus first-quarter EBIT of 619 million sfr, down from 686 million sfr the year before, hit by lower margins and higher costs, due to the market launch of its Bluewin TV offering and other new businesses.

At 461 million sfr, the telecom group's net profit was little changed from the 460 million recorded the year before, mainly due to the repurchase of a 25% stake in Swisscom Mobile from Vodafone Group last December, freeing it from substantial minority payments.

Analysts had forecast EBIT to reach 605-654 million sfr, or 631 million on average.

Net profit was expected to come in between 446-513 million sfr or 475 mln on average. Sales were also little changed at 2.376 billion sfr, against 2.375 billion, and compared to analysts forecasts of 2.337-2.400 billion sfr, or 2.368 billion on average.

Swisscom also confirmed its targets, saying still expects to close 2007 with sales of around 9.7 billion sfr and EBITDA of around 3.9 billion sfr and EBITDA of around 3.9 billion sfr.