Bloomberg News

Telecom Argentina 4th-Quarter Loss Widens on Currency

March 09, 2006

Telecom Argentina SA (TECO2), the country's second-biggest telephone company, said losses in the fourth quarter widened as a slide in the local currency made it more costly to repay dollar-denominated debt.

Telecom, controlled by Telecom Italia, had a net loss of 289 million pesos ($93.7 million), or $1.47 per share compared with a loss of 175 million pesos, or 89 centavos per share a year ago.

The Buenos Aires-based company remains one of the market leaders and its results should improve as its marketing costs fall, said Guido Bizzozero, an equity analyst at Allaria Ledesma SA, a brokerage company in Buenos Airs.

``The company is in good competitive standing,'' said Bizzozero. ``It suffered from the peso depreciation and had to face mounting marketing costs.''

Telecom had sales of 1.6 billion pesos in the quarter, a 29 percent increase over the same period of 2004. Marketing costs, such as selling handsets at subsidized prices, more than doubled from the fourth quarter in 2004.

Total revenue for the year ended Dec. 2005 rose to 5.7 billion pesos, or 27 percent from 4.4 billion pesos a year earlier.

Telecom shares rose 41 cents, or 3.25 percent, to $13.03 in New York. The shares have climbed 5.4 percent so far this year from $12.96 on Jan. 3, 2006.

To contact the reporter on this story: Daniel Helft at dhelft@bloomberg.net

To contact the editor responsible for this story: Laura Zelenko at lzelenko@bloomberg.net


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