May 3 (Bloomberg) -- France Telecom SA may sell some of its smaller European operations as growth slows on the continent, its chief financial officer said today.
France’s biggest phone company is reviewing its European portfolio, Gervais Pellissier said on a conference call with reporters. Aside from France, Poland and Spain, “all the other countries are involved in this review,” which will examine opportunities for consolidation as well as possible sales of operations, he said.
Chief Executive Officer Stephane Richard is weighing the future of businesses in countries including Austria, Belgium, and Romania as growth in Africa and the Middle East roars ahead. The Paris-based company said today that sales in its smaller European markets rose 1.2 percent in the first quarter, compared with a 5.8 percent rise in Africa and the Middle East excluding Egypt.
“It’s getting more important to go to emerging countries to find growth triggers,” Jan Goehmann, an analyst at Norddeutsche Landesbank Girozentrale in Hannover, said in a telephone interview.
First-quarter earnings before interest, taxes, depreciation, and amortization slipped 1.3 percent to 3.73 billion euros ($5.5 billion), hurt by a consumer tax that took effect this year and unrest in Egypt, France Telecom said. Analysts had predicted Ebitda of 3.72 billion euros, according to the average of eight estimates compiled by Bloomberg, while revenue rose in line with estimates to 11.2 billion euros.
Share Climb
France Telecom climbed 2 cents, or 0.1 percent, to 15.88 euros at 9:04 a.m. in Paris. Deutsche Telekom AG and Telecom Italia SpA slipped 0.1 percent in Frankfurt and Milan, respectively. Both companies are scheduled to report earnings this week.
In March, France Telecom paid $245 million for a stake in Iraq’s Korek Telecom, adding to Middle Eastern operations in neighboring Jordan as well as Egypt and Bahrain.
The company last month announced the creation of a joint venture with Bonn-based Deutsche Telekom devoted to more efficient purchasing of equipment, part of a broad collaboration between the two companies begun this year.
The rising pace of technological change in the mobile industry is pushing mobile operators to collaborate. Richard has built closer links between Europe’s five largest mobile operators, a group that includes Telefonica SA, Vodafone Group Plc, and Telecom Italia, in addition to Deutsche Telekom and France Telecom.
The CEOs of the five companies, four of which are former national phone monopolies, met last year in Paris to discuss subjects including work on mobile operating systems and handling surging quantities of data traffic on wireless networks.
--Editors: Kenneth Wong, David Risser
