Bouygues keeps full-year goals in spite of weak Q1 re­sults

Poor weather in Europe has hurt per­for­mance of the French con­glom­er­ate’s road con­struc­tion arm Co­las dur­ing irst quar­ter

The Gulf Today - Business - - INTERNATIONAL -

PARIS: French con­glom­er­ate Bouygues posted a worse-thanex­pected first quar­ter group oper­at­ing loss, although it main­tained its full year targets amid fur­ther signs of an im­prove­ment at its tele­coms divi­sion.

Poor weather in Europe had hurt the per­for­mance of Bouygues’ road con­struc­tion arm Co­las dur­ing the first quar­ter, but Bouygues said the quar­ter was not rep­re­sen­ta­tive of how the com­pany ex­pected to per­form over the full year.

Bouygues’ tele­coms arm also man­aged an­other im­prove­ment in its re­sults and the French con­glom­er­ate stuck to its prediction for a fur­ther rise in prof­its over the full year.

Bouygues, which failed to merge its tele­coms unit with mar­ket leader Or­ange two years ago, said it should con­tinue to grad­u­ally im­prove its prof­its in 2018.

The fam­ily-con­trolled Bouygues group, which also builds roads and owns France’s big­gest pri­vate TV broad­caster TF1 , said first-quar­ter rev­enue dipped to 6.826 bil­lion eu­ros ($8.1 bil­lion) from 6.837 bil­lion a year ago.

Its cur­rent oper­at­ing loss also widened to 111 mil­lion eu­ros from a 75 mil­lion loss last year, re­flect­ing a 302 mil­lion loss at Co­las.

Ac­cord­ing to a com­pany compiled poll of 12 an­a­lysts, the me­dian fore­casts for Bouygues had pre­dicted quar­terly sales of 6.913 bil­lion eu­ros and a cur­rent oper­at­ing loss of 101 mil­lion.

Yet Bouygues Tele­com’s quar­terly rev­enues rose 6 per cent to 1.281 bil­lion eu­ros and Bouygues Tele­coms’ cur­rent oper­at­ing profit also rose to 50 mil­lion eu­ros from 32 mil­lion last year.

Bouygues Tele­com also con­firmed its targets for 2018 and 2019.

France’s tele­coms sec­tor, hit by a price war fol­low­ing the en­trance of low-cost player Iliad in 2012, has been the sub­ject of takeover spec­u­la­tion in re­cent years.

Last month, Bouygues said it was not in dis­cus­sions with any other op­er­a­tor, deny­ing a news re­port that it was weigh­ing a bid to ac­quire the French SFR tele­coms unit of ri­val Altice .

Bouygues Tele­com has said it can pros­per on its own and has re­sponded with a turn­around plan in­clud­ing job cuts and a fo­cus on the roll­out of its 4G net­work and fixed-line broad­band, help­ing it win new cus­tomers.

Bouygues Tele­com’s ro­bust per­for­mance came amid heavy pro­mo­tions by Altice’s SFR and mar­ket leader Or­ange, which ri­val Iliad had partly blamed for its own weak­erthan-ex­pected re­sults ear­lier this week.

Mean­while, Euro­pean stocks pushed higher in early trad­ing on Thurs­day as Ital­ian stocks re­cov­ered some lost ground and com­modi­ties-re­lated sec­tors ral­lied, while shares in Ocado rock­eted af­ter the com­pany signed a part­ner­ship deal.

The pan-euro­pean STOXX 600 was up 0.1 per cent, hold­ing at 3-1/2 month highs as shares in en­ergy stocks and min­ers rose, while Italy’s bench­mark climbed more than 1 per cent as mar­kets awaited the re­sult of talks be­tween two anti-sys­tem par­ties to form a coali­tion gov­ern­ment.

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