Telefónica Sees Strength in Diversification -- 67% Revenues Outside of Spain

Despite weakness in its home market of Spain, the Telefónica Group's revenues rose to 44,280 million euros
in the first nine months of 2010, up 6.0% year-on-year in the first nine months of the year and at 7.3% year-on-year in the quarter. Telefónica continues to further increase revenue diversification, and Telefónica España now accounts for just 32% of Group revenues, with 67% coming from Telefónica Latinoamérica (42%) and Telefónica Europe (25%).


The company reported that total number of accesses across all its divisions rose to 281.8 million, which represents organic growth of 7.1% versus the end of September 2009 (reported growth of 4.9%). By region, of particular note are the expansion of the customer base at Telefónica Latinoamérica (+9.4% year-on-year) and Telefónica Europe (+5.8% year-on-year organic; +13.8% reported).


Mobile accesses at the Telefónica Group stood at 214.9 million at the end of September, a year-on-year organic growth of 9.2% (+4.4% reported). Organic net additions since the beginning of the year reached 12.7 million accesses (+3.9 million accesses in the third quarter).


Telefónica noted a strong take-up of smartphones and dongles, as the number of mobile broadband accesses rose to more than 19 million by the end of September 2010 (+73.4% year-on-year), a figure that represents
a penetration over the total mobile access base of 9%.


Retail fixed broadband accesses reached a total of 16.7 million, with organic net additions of 1.1 million accesses since the beginning of the year (3.2 million reported). This represents an organic year-on-year increase of 10.7% (+26.5% reported), a significant acceleration versus the growth rate recorded at the end of June (+9.2%), driven by the improvement in quarterly net additions in Latin America and the growing activity in Germany (net additions were 3.6 times greater than in the previous quarter) and Spain (net additions rose 24.4%
quarter-on-quarter). The number of pay-TV accesses stood at 2.7 million at the end of September, a 7% increase in organic terms on September 2009 (+9.8% reported).
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