(Telecompaper) Telefonica reported a return to organic revenue growth in the second quarter, while reported results continued lower following a range of divestments. Organic revenue was up 0.5 percent year-on-year, led by the Latin America, where growth accelerated to 10.4 percent. Telefonica's European activities also limited the revenue decline to 8.8 percent year-on-year. OIBDA was still down 0.7 percent on an organic basis, despite a range of cost reductions. On a reported basis, revenues fell 6.8 percent to EUR 14.42 billion, OIBDA declined 9.3 percent to EUR 4.85 billion, and the margin dropped 0.9 percent points from a year earlier to 33.7 percent. Net profit fell 13.1 percent to EUR 1.15 billion. Telefonica finished the quarter with EUR 49.79 billion in net debt, equal to 2.40 times OIBDA. If later disposals are included, such as O2 Ireland, Inversis and 40 percent of the Central America activities, net debt would have been reduced by a further EUR 1.18 billion or 2.36 times OIBDA. The company reiterated its target for debt below EUR 47 billion by year-end and capex around 14 percent of sales this year. In the first half, Telefonica invested EUR 3.90 billion in capex, up 6.7 percent from a year earlier, while operating cash flow fell 18.5 percent to EUR 5.52 billion. The Spanish operator also still expects an increase in full-year organic sales and a small decline in the OIBDa margin this year.
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