Results from state-controlled Portugal Telecom SA were at the top of analysts’ forecasts, and the company is proposing a gross dividend of 138 escudos per share, up from 91 escudos in 1995. More shares in Portugal Telecom are due to be sold later this year – the state’s stake has been progressively cut to 51% and the Socialist government plans to float a further 26% later this year. The company said emerging businesses – cellular telephony, cable television and data transmission – increased their share of overall group revenue in 1996 to 11.4% in 1996 from 8.3% the year before. Fixed telephone services continued to show steady growth, with revenue rising 5.8%; domestic phone service revenues rose 11% to $1.54bn but international services were down 8.1% at $480m. It says its strategic priorities remain to increase telephone penetration, which rose to a disconcertingly low 38.5% in December 1996 from 36.7% a year earlier, to rebalance tariffs by reducing long distance and international charges, and to improve the quality of service, especially to major accounts. It says it remains on track to meet its target of having 97% of local switching digital by next year against 79.4% at the end of last year.