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Belgacom First-Half Beats Consensus, Raises Guidance

Belgium's dominant telecom operator Belgacom reported first-half results above market expectations on Friday and unexpectedly raised its 2007 financial guidance for both mobile and fixed-line revenues.

The former state monopoly said it expected full-year 2007 revenues to decline in fixed line by only 1 percent rather than the 1% to 2% range it had previously given.

It also said it saw a revenue decline of 4% for its mobile unit Proximus rather than the previous 5% to 7% fall range it had previously given.

Analysts had said prior to the results that given the roaming rate cuts imposed by the European Union, Belgacom might lower its earnings forecast for Proximus.

Belgacom said first-half revenues rose slightly by 0.2% to 3.039 billion euros, while earnings before interest, tax, depreciation and amortization (EBITDA) fell 2.8% to 1.079 billion euros, and net profit jumped 30% to 564 million euros.

A poll of five analysts by Reuters gave average forecasts for revenues of 3.005 billion, core profit of 1.054 billion and net profit of 539.2 million euros, respectively.

While analysts had speculated Belgacom was likely to return cash to shareholders through an interim dividend or a share buy-back scheme, the telecoms group did not mention such a scheme in its statement.

Under Belgian law, Belgacom must be majority-owned by the state, but analysts said the group is likely to be privatised in the coming years after the defeat of the socialists at the June general elections.