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Takeover target Euskaltel swings to first-half loss

·1 min read

MADRID, July 27 (Reuters) - Spanish telecoms company Euskaltel, the subject of a takeover bid by rival Masmovil, on Tuesday reported a first-half net loss of 5.5 million euros ($6.51 million) against a 35.6 million euro profit in the same period last year.

Earnings before interest, tax, depreciation and amortisation (EDITDA) fell to 147 million, 16% below last year's H1 EBITDA after booking impairments due to the merger, which has suspended asset sales and contract renegotiations.

Revenue was up slightly year on year at 338.8 million euros.

Euskaltel posted record growth in its client base of now 863,000 customers - up 10.3% compared to the second quarter of 2020 and buoyed by its partnership with Virgin in launching a new mobile and broadband brand across Spain in May 2020.

A project to upgrade its cable network to fibre-to-the-home (FTTH) also accelerated a 13 million euro depreciation in cable assets over the second quarter as Euskaltel, like many European rivals, is struggling with the high costs of overhauling its infrastructure.

The teleco said mobile service contracts had grown most sharply, followed by ultra-fast broadband contracts - two market segments likely boosted by the continued shift of both personal and professional activity online as a result of the pandemic. ($1 = 0.8453 euros) (Reporting by Clara-Laeila Laudette; editing by David Evans)

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