Telecom Argentina S.A. Announces Consolidated Six-Month Period ('1H08') and Second Quarter Results for Fiscal Year 2008 ('2Q08')

BUENOS AIRES, Argentina , Aug. 5 /PRNewswire-FirstCall/ -- Telecom Argentina (BASE: TECO2, NYSE: TEO), one of Argentina's leading telecommunications groups, announced today a Net Income of P$613 million for the six-month period ended June 30...

BUENOS AIRES, Argentina , Aug. 5 /PRNewswire-FirstCall/ -- Telecom Argentina (BASE: TECO2, NYSE: TEO), one of Argentina's leading telecommunications groups, announced today a Net Income of P$613 million for the six-month period ended June 30, 2008 , or +58% when compared to same period of the previous year, which included P$102 million that resulted from discontinued operations.

During 1H08, Consolidated Net Revenues increased by 20% (+P$849 million vs. 1H07) to P$5,051 million, mainly fueled by the cellular and broadband businesses.

Moreover, OPBDA increased by 19% (+P$273 million) to P$1,687 million (33% of Consolidated Net Revenues).

Company Activities

Consolidated Net Revenues

The evolution in Consolidated Net Revenues by reportable segment was as follows:

Voice, Data Transmission & Internet

During the first six-month period of 2008, revenues generated by these services amounted to P$1,764 million, +11% vs. 1H07.


Total Revenues for this service reached P$1,322 million (+5% vs. 1H07). The results of this line of business are still affected by frozen tariffs of regulated services.

During this three-month period, Telecom continued with the marketing of innovative handsets and equipment and value-added services, which before were available only for cellular telephony such as fixed SMS services and video calls. An example is the fixed-line handset that integrates photo frame, video and MP3. Bundling promotions of equipments plus SMS packages were also successfully marketed. Other offered products combine voice minutes packages and broadband internet access.

Moreover, during this period, Telecom continued with the deployment of the next generation network (NGN) in its fixed telephony network that will allow the offering of convergent state-of-the-art services.

Simultaneously, Telecom set up a project oriented to improve the quality of voice and data transmission services.

Monthly Charges and Supplementary Services increased by P$27 million, or 7%, to P$393 million, as a consequence of a higher number of lines in service (+3%), reaching 4.3 million of lines.

Revenues generated by traffic (Local Measured Service, Domestic Long Distance and International Telephony) totaled P$605 million, an increase of 1% vs. 1H07, partially affected by a slight decrease in local traffic volume.

Interconnection revenues amounted to P$190 million (+9%), mainly as a consequence of traffic originated in cellular lines but transported by and terminated in the Company's fixed-line network.

Other revenues, including public telephony reached P$134 million (+12% vs. 1H07). This amount is the consequence of an increase in billing and collection fees as well as voice, data and internet handset sales despite a decrease in Public Telephony revenues (-P$15 million).

Data Transmission and Internet

Revenues generated by Data transmission amounted to P$103 million, (+27% vs. 1H07).

Related to the corporate market, during 2Q08, Telecom continued enhancing its position as integrated provider of innovative ICT solutions or Information and Communication Technology, conceived to satisfy specific needs from each business segments, medium and large companies and oriented to contribute in the improvement of governmental administration at the different national, provincial and municipal levels.

In addition, Telecom Argentina was selected by the provincial government of Corrientes to implement the 911 Urban Emergencies Integral Management System and the Control & Tracing Urban System in the city of Corrientes. Both systems are turnkey integral solutions that include the reception and administration of police emergencies as well as the control and video- surveillance tracking. The solution also includes the subsequent capitalization of statistic information and capture of images in order to optimize the human and material resources and delinquency preventive actions.

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