Swisscom Net Beats Estimates; New CEO to Be Named This Year

Swisscom AG, Switzerland’s biggest phone company, reported second-quarter profit and revenue that topped analysts’ estimates and said it plans to appoint a new chief executive officer by the end of this year.

Net income dropped 6.8 percent to 427 million francs ($461 million), the Bern-based company said today. Profit exceeded the 408 million-franc average estimate by analysts, according to data compiled by Bloomberg. Sales rose 1.5 percent to 2.86 billion francs, compared with the 2.8 billion-franc estimate.

Swisscom, which made more than 80 percent of its revenue last year from its home country, is coping with sluggish consumer demand that pushes phone bills down across Europe. Its Italian fixed-line unit, Fastweb, boosted its broadband connections to 1.89 million lines at the end of June from 1.67 million a year earlier.

Earnings before interest, taxes, depreciation and amortization were 1.07 billion francs, compared with 1.13 billion francs a year earlier and the 1.08 billion-franc average estimate of analysts.

Swisscom shares rose 1.3 percent to 418.50 francs as of 10:18 a.m. in Zurich, valuing the company at 21.7 billion francs. The stock advanced 4.9 percent this year through yesterday while the Bloomberg Europe Telecommunication Services Index climbed 8.6 percent in the same period.

The company confirmed its full-year Ebitda forecast of at least 4.25 billion francs and said revenue will be more than 11.4 billion francs, compared with its previous projection for 11.3 billion francs.

On July 23, Swisscom named the head of its Swiss business, Urs Schaeppi, as interim chief executive officer to replace Carsten Schloter, who was found dead at his home in what police said was a suspected suicide. A new CEO will be appointed before the end of this year, Swisscom said today.

Before it's here, it's on the Bloomberg Terminal.