Telekomunikacja Net Rises 28% as Phone Company Cuts Cost

Telekomunikacja Polska SA (TPS), Poland’s largest phone company, said first-quarter profit rose 28 percent on lower amortization and falling cost of debt.

Net income increased to 242 million zloty ($76.6 million) from 189 million zloty a year earlier, the Warsaw-based company said in a regulatory filing today. That beat the average estimate of 232.9 million zloty by eight analysts surveyed by Bloomberg.

Sales fell 3.4 percent to 3.52 billion zloty, driven by a 5.4 percent decline of revenues at the company’s fixed-line business. At the same time mobile phone services sales increased 0.3 percent.

Telekomunikacja, controlled by France Telecom SA (FTE), has seen revenue decline since 2007 as competition increased and the domestic regulator forced operators to cut prices. The Warsaw- based company expects sales to fall by as much as 3 percent in 2012 as the country’s telecommunication watchdog wants to lower the rates that mobile phone operators charge each other for calls to their networks.

Profit at the operator, which this month started offering all services under its parent company’s Orange name, was helped by lower amortization write-offs that fell 146 million zloty, as well as by a 23 million-zloty decline of cost of debt, the company said.

To contact the reporter on this story: Marta Waldoch in Warsaw at mwaldoch@bloomberg.net

To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net

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