Jazztel, which said today that 2011 profit soared to 50.7 million euros ($67.8 million) from 7.2 million euros a year earlier, forecast that net income will climb to 55 million euros to 65 million euros this year. The prediction makes assumptions about taxes and tax credits, the company said in a statement.
“The main reason we are growing significantly in Spain is because of the quality of the service we provide,” Chief Executive Officer Jose Miguel Garcia told reporters in Barcelona. “Even as the Spanish market is a very competitive one, we are managing to prosper.”
As Spain’s economy weakens amid growing unemployment and declining incomes, many broadband customers are switching providers for better prices or service. Jazztel said earnings before interest, taxes, depreciation and amortization this year will be 170 million euros to 180 million euros.
“Results beat the guidance for 2011 and show an improvement in growth forecast for 2012,” Marta Gomez, a Madrid-based analyst at Banesto Bolsa who recommends buying the stock, wrote in a report to investors. “There’s still value in the company.”
Jazztel shares fell 3.2 percent to 4.29 euros in Madrid today, valuing the company at 1.06 billion euros. The shares have climbed 15 percent this year, outperforming the IBEX 35 Index’s 1.2 percent decline.