Telecom Italia shares are trading higher Thursday morning following the publication of better-than-expected Q1 earnings and sales growth in its home market. The telecoms group also announced Wednesday that Vivendi was no longer exercising control and coordination over the company.
By 1015 BST, Telecom Italia shares were 1.35% higher at €0.78. The stock has recently been trending downwards amid shareholder disagreements between Vivendi and Elliott. The Telecom Italia Board is now made up of two thirds of Elliot’s nominees.
Telecom Italia Board approves earnings results
In the first earnings release under the new management board, Telecom Italia reported that its total domestic revenues grew 1.7% in the first quarter from 2018 from a year earlier. The domestic mobile segment was particularly impressive, with revenues there 4.7% higher than a year earlier.
However, total profits were hit by a “Golden Power” rule-related charge, that the firm is currently contesting. Telecom Italia is subject to a €74.3 million fine, which weighed on comparable profits.
“The solid results of Q1 2018 are driven by positive Domestic performance and strong growth in Brazil which confirm we are already leveraging on the progress made with our DigiTIM strategy”, said Amos Genish, Telecom Italia’s CEO.
“In Italy, both the Mobile and Fixed UBB customer base, together with ARPU, are steadily growing, rewarding TIM’s continuous coverage upgrading and focus on quality, supporting our premium player position,” Genish added.
Vivendi no longer in control
Just ahead of the Q1 earnings report, Telecom Italia said late Wednesday that Vivendi – the largest shareholder in the telecoms firms – is no longer controlling the business.
Telecom Italia published a press release titled: Vivendi’s direction and coordination ceases.”
“The composition of the Committees, the deliberations on corporate governance issues and the savings in the Directors’ remuneration confirm the process started by this Board towards TIM’s transformation into a public company, focused on achieving the results disclosed to the market,” chairman of the board Fulvio Conti said.
The press release also states: “Finally, the Board of Directors has deemed that Vivendi is no longer a party exercising direction and coordination over TIM and therefore terminated the previous direction and coordination activity.”