France Telecom on Friday published its first financial results since becoming what is termed an autonomous operator, which means that the figures are not comparable with those published last year. It reported 1991 net profit equivalent to $394m on turnover of $22,270m, up 6.8% from 1990. The increase in France Telecom’s revenues was less than the 8% increase in 1990, and slightly below forecasts that avearged out at 7%. Nevertheless, director of programmes and finance Pierre Hilaire said This increase in our revenues puts us in a favourable spot with respect to our competitors. France Telecom bettered its own net profit forecast of $250m however. A previously agreed payment of $2,800m will have to be made as a substitute for the business taxes that it will begin to pay once it becomes a limited liability company in 1994. For each year of the transitional 1990-to-1994 period, in which Telecom moves from being a public utility to a private company, it agreed, in 1990, to pay the amount it contributed to the state budget in 1989 – $2,630m adjusted for inflation. A France Telecom spokesman said the company would have paid only $1,7300m in taxes, had it been private in 1991 – So we’re paying more taxes than we need to. Although France Telecom reduced its debt by $288m in 1991, its total debt remains a staggering $23,190m. Total financing costs represent 9.7% of revenues, as opposed to 10.5% in 1990. Said Hilaire, The situation is not critical. Deutsche Bundespost Telekom, Telefonica de Espana SA and la SIP are much more indebted than we. But we will continue to reduce our financing costs, since at some of our competitors, such as British Telecommunications Plc, the weight of their debt with respect to revenues is much lower at 3%. He added that the objective is to reach 7% in 1994. For the fiscal year in progress, France Telecom expects a revenue increase of only 6%. After a growth of 6.8% for the first half, the second half has not been very good, Hilaire acknowledged. The net income will be about $577m and we will bring the debt down to 8.8% of turnover. Revenues, broken down by sector, see telephony making up 68.9% of business; rentals and new lines at 15.5%; specialised networks at 7.5%; mobile telephony at 2.3%; directories at 2.4%; and miscellaneous at 3.4%.
