OTE, southeast Europe's biggest telecoms company, missed first-quarter profit forecasts as it cut jobs after losing customers in its recession-hit Greek home market.
Net profit fell by 54 percent, hurt by a 40 million euro charge for laying off 1,600 workers in Greece and Romania, OTE said on Friday.
The former monopoly, 30-percent owned by Germany's Deutsche Telekom, made a net profit of 30.2 million euros compared with a forecast for 59.9 million euro in a Reuters poll.
OTE shares were flat in Athens, in line with the broader market, with some analysts attributing this to the company's statement that cost cuts should start improving results later this year.
OTE lost about a tenth of its fixed-line customers in its two biggest markets Greece and Romania last year, as cash-strapped callers turned to cheaper rivals. Tough regulation often prevents OTE from matching competitors' offers.
Customer losses in OTE's Greek fixed-line business continued in the first quarter, decelerating slightly to 99,000 lines from 134,000 in the previous quarter.
Mobile phone operations, the group's most profitable business, also continued to suffer. Airtime revenues, excluding monthly service fees, dropped 22 percent year-on-year to 171.6 million euros, following a 20 percent decline in the previous quarter.
"With revenues showing some signs of stabilisation and cost-cutting measures gradually beginning to kick in, we expect OTE's performance will start improving in the latter part of the year," CEO Michael Tsamaz said in the statement.
The company, which is active in six countries in the Balkans, will pay a dividend of 0.1179 euros a share on last year's earnings, compared with 0.19 euros a share it paid in 2010.
REUTERS
