Telefónica obtained a net profit of 886 million euros during the first quarter of 2021, 118.3% more than in the same period of the previous year, due to the reduction of debt and the effect of lower amortizations. But despite the good results, the company chaired by Álvarez Pallete earned 10,340 million euros, 9% less than in the same period of 2020. Among other reasons, due to the closure of stores in the United Kingdom due to restrictions on that country, in addition of the negative impact on currency exchange in the Brazilian and Hispanic American markets.
By markets, Spain, Germany, United Kingdom and Brazil, contributed 78% of the income and 88% of the Oibda (operating income before amortization). Specifically, Spain provided 29% of the group’s income (although it fell by 0.9%); Germany, 18%; UK, 15% and Brazil, 16%. As to Hispam (Latin America) this registered 19% of the company’s total revenues during the first three months of 2021.
For the company, these results “show the strength of the business model, the effectiveness of the applied management focused on cost reduction, the stability of the operating cash flow, and the lesser impact of the effects derived from the pandemic».
To highlight, the reduction of its main ballast: Debt. Thus, the company’s net financial debt as of March 31 was 35,796 million euros, 6.4% less than a year before. In this sense, they hope that with the execution in the coming weeks of the O2 and Virgin integration in the United Kingdom and the sale of the Telxius Towers, its liabilities were reduced by 9,000 million to 26,000.
The company also emphasizes in its accounts that quantifies a liquidity close to 20,000 million euros.
“These results reflect the success of our strategic plan and Telefónica’s ability to execute to achieve sustainable and profitable growth, driven by our technology businesses and by the deployment of the best networks and services,” he added. the president of Telefónica, José María Álvarez-Pallete, on the results of the first quarter.
In the same vein, the company assures that the first quarter figures “place us on the path of meeting the financial objectives established for 2021, consisting of a stabilization of income and income. Oibda, in addition to a return to a normalized level of investment on sales of up to 15% ”.
Telefónica had closed 2020 with a net profit of 1,582 million euros, 38.5% more than in 2019. All this, despite the fall in income of 11% per year to 43,076 million euros and that, from telco, attributed to the currency effect and, to a lesser extent, to the impact of the Covid -19.