France Telecom SA Chief Executive Officer Stephane Richard said the phone company’s 2012 dividend will be reduced “reasonably” and the owner of the Orange brand won’t sacrifice investments as it responds to price cuts by Iliad SA. (ILD)
“For 2012, it is clear that we will lower the level of our dividend to take into account how our results evolve,” Richard said in an interview with BFM Business Radio. “Our dividend will go down reasonably.”
With one of the highest dividend yields in the telecommunications industry in Europe, Paris-based France Telecom has been under pressure to cut payouts to preserve cash as Europe’s debt crisis hurt consumer demand. Telefonica SA (TEF) last week slashed the cash portion of its 2012 dividend by 69 percent and announced plans to spin off its German and Latin American assets to accelerate debt repayment. Telecom Italia SpA (TIT) announced cuts to its 2011 dividend in February.
France Telecom said on Feb. 22 that its 2012 payout will be in a range of 1.21 euros to 1.35 euros a share, cutting the forecast from 1.40 euros a share, because of a projected decline in operating cash flow. At the annual shareholders’ meeting in Paris today, Richard reiterated the company’s forecasts for 2012, including a plan for payouts of 40 percent to 45 percent of operating cash flow.
Employees’ Proposal
Shareholders are set to vote on the 2011 dividend at the meeting. An investment fund representing workers who are also shareholders has filed a resolution proposing to reduce the payout to 1 euro a share from the planned 1.40 euros.
Richard told BFM that there’s no reason to cut the 2011 figure. He told investors at the meeting that the dividend for 2012 will probably exceed 1 euro a share.
France Telecom fell 0.2 percent to 10.25 euros at the close in Paris. The stock has declined 16 percent this year, valuing the company at 27.2 billion euros ($33.8 billion).
The dividend yield is 13.6 percent, compared with an industry average of 9.3 percent and 13.9 percent for Madrid- based Telefonica, according to data compiled by Bloomberg.
The phone company has “no intention of conducting share buybacks” this year, Chief Financial Officer Gervais Pellissier said at the annual meeting.
To contact the reporter on this story: Marie Mawad in Paris at mmawad1@bloomberg.net
To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net
France Telecom CEO Stephane Richard
Antoine Antoniol/Bloomberg
Stephane Richard, chief executive officer of France Telecom SA.
Stephane Richard, chief executive officer of France Telecom SA. Photographer: Antoine Antoniol/Bloomberg
Mitec Telecom provides corporate and listing updates - CNW Group
MONTREAL, June 5, 2012 /CNW Telbec/ - Mitec Telecom Inc. ("Mitec") (TSX: MTM), today announced that its shares will commence trading on NEX effective at the opening of TSX Venture Exchange trading hours on June 8, 2012.
Mitec's trading symbol will be "MTM.H", indicating its NEX listing. Mitec's transition from the TSX to the NEX provides a more flexible listing status that allows it to continue to evaluate opportunities going forward and reduces listing costs significantly. Other than adding ".H" to Mitec's listing symbol, there are no other changes relating to Mitec's transition to the NEX market.
As previously announced, Mitec applied to voluntarily delist its common shares for trading on the Toronto Stock Exchange, which will occur at the close of business on June 7, 2012.
Mitec has also determined that it is in its best interests at this time to reduce its Board of Directors from five members to three, and has accepted the resignations of Hubert Marleau and Robert Boisjoli. "Both Mr. Marleau and Mr. Boisjoli have assisted Mitec in successfully resolving significant challenges that have faced the company over these many years and we thank them for the valuable contributions they have made", commented Jeffrey Mandel, President and CEO of Mitec.
About Mitec Telecom Inc.
Mitec is a leading designer and provider of radio frequency (RF) products for the telecommunications industry. Mitec sells its products worldwide to network providers for incorporation into high-performing wireless networks used in voice and data/internet communications. Mitec is located in Montreal, Canada. Mitec is listed on the Toronto Stock Exchange under the symbol MTM. On-line information about Mitec is available at www.mitectelecom.com.
Certain statements in this release, including statements regarding future results and performance, are forward-looking statements based on current expectations. The accuracy of such statements is subject to a number of risks, uncertainties and assumptions that may cause actual results to differ materially from those projected, including, but not limited to, the effect of general economic conditions, decreases in demand for Mitec's products, fluctuations in selling prices and adverse changes in general market and industry conditions and other factors listed in Mitec's public filings with the appropriate securities regulatory authorities.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information:
Source: Mitec Telecom Inc.
Contact:
Mr. Jeffrey Mandel
President, CEO and Chairman, Mitec Telecom Inc.
jeffrey.mandel@mitectelecom.com
Tel.: (514) 694-9000
Telecom stocks decline ahead of EGoM on spectrum pricing - MSN India
Mumbai, June 5 (PTI) Shares of telecom service providers, led by Bharti Airtel and Reliance Communications, were battered today ahead of a meeting of the group of ministers that will decide on the base price for 2G spectrum auction.
Bharti Airtel settled 2.59 per cent lower at Rs 287.05 on the BSE. Intraday, the stock had plunged by three per cent to touch day''s low of Rs 285.70.
Reliance Communications closed lower by 1.19 per cent at Rs 62.05, while Idea Cellular shed 0.33 per cent to end at Rs 76.
Tata Communications, however, managed to end in the positive territory. Its scrip was up by 0.82 per cent to close at Rs 220.45.
Market analysts said counters of telecom companies were under pressure as an increase in spectrum charge will put additional burden on the industry.
An Empowered Group of Ministers (EGoM), headed by Finance Minister Pranab Mukherjee, will meet later in the day to decide on the base price for the second generation (2G) spectrum auction.
The auction follows a Supreme Court''s order to cancel 122 2G licences awarded by former Telecom Minister A Raja in 2008.
The EGoM would decide whether to opt for the reserve price recommended by the Telecom Regulatory Authority of India (Trai) or that suggested by an internal committee of the Department of Telecommunications (DoT).
Trai had suggested Rs 18,000 crore as the all-India base price for auction of 5 MHz spectrum, while the DoT panel had proposed a price 17 per cent higher.
Meanwhile, the BSE''s benchmark Sensex closed at 16,020.64 points, up 32.24 points, or 0.2 per cent, from the previous close.
Telecom tariff might increase by 26 paisa, analyst - Top News India
According to an analyst at the research firm Ernst&Young, the telecom tariff is like to increase by as much as six times the 4.4 paisa estimated by the Telecom Regulatory Authority of India (TRAI), or by 26 paisa per minute if the impact of two factors is considered.
Analyst said that the TRAI did not take into consideration the cost of license extension and the cost of spectrum to be auctioned while estimating the increase in tariff during financial year 2013.
Partner in member firm of EY Prashant Singhal said, "TRAI's assessment does not include the cost of license extension in addition to the cost of spectrum to be auctioned. Taking into account, these two factors only, EY-COAI estimates that the impact on cost per minute will be more than six times the 4.4 paisa." The remarks come just two days before the meeting of Empowered Group of Minister of telecom.
The analysis from the research firm sheds more light into the ongoing deliberations into the matter after TRAI recommended a base price of Rs 3,622 per unit of airwaves that are to be auctioned to the telecom service providers in the country.
Nokia's Lumia 900 Can't Stack Up Against the iPhone - Motley Fool
Nokia's (NYSE: NOK ) fancy new Lumia 900 may be the Finnish giant's new belle of the ball, but it also costs a pretty penny. The flagship Microsoft (Nasdaq: MSFT ) Windows Phone device is getting a lot of backing from carrier partner AT&T (NYSE: T ) , which is gunning up its marketing engines into high gear to push its new exclusive smartphone.
Although if you were to compare the component costs next to Apple's (Nasdaq: AAPL ) latest iPhone 4S, it doesn't paint a very pretty margin picture for Nokia. Apple's device sells for more and costs less, spelling out juicier margins for Cupertino. Here's how the iSuppli bill of material estimates for some of the more relevant (and expensive) components stacks up:
|
Component |
Nokia Lumia 900 |
Apple iPhone 4S |
|---|---|---|
| Display and touchscreen | $58 | $37 |
| Processor | $17 | $15 |
| Memory | $27 | $28 |
| Wireless chips | $38 | $24 |
| Cameras | $18 | $18 |
| Power management | $9 | $7 |
| Mechanical and electro-mechanical | $18 | $33 |
| Total component cost | $209 | $190 |
| Unsubsidized retail price | $450 | $649 |
| Gross margin ($) | $241 | $459 |
| Gross margin (%) | 53.5% | 70.7% |
Source: iSuppli.
That's a pretty major margin advantage for Apple to enjoy on its newest iteration of the iPhone, which also helps explain why Nokia's overall gross margin of 27.7% last quarter hardly compares with the 47.4% gross margin that the iPhone maker enjoyed last quarter.
On the cost side, there are a couple of notable differences worth mentioning on why the Lumia 900 racks up more component costs than the iPhone.
The display and touchscreen combination costs much more on the Lumia 900, but there are two big differences. The Lumia 900 features a notably larger 4.3-inch display, compared with the 3.5-inch iPhone Retina Display. The Lumia 900's display is also an AMOLED display from Samsung, which are pricier to manufacture.
Both devices use wireless chips from Qualcomm (Nasdaq: QCOM ) , but the Lumia 900 uses one with 4G LTE capabilities, while the iPhone will likely see 4G LTE data speeds later this year served up by Qualcomm's newest 28-nanometer baseband chips. For now, the current iPhone's 3G speeds are slower than the Lumia 900's data connection.
These cost estimates exclude things like manufacturing, marketing, distribution, or software R&D. Of course, Apple spends very little on R&D in percentage terms relative to its revenue, and Microsoft is the one pitching in the Windows Phone operating system on the Lumia 900.
Nokia's fate looks dimmer each quarter, with its first quarter smartphone market share getting slashed by nearly two-thirds and falling into single-digit territory as Samsung and Apple take over. Its margins aren't helping much, either.
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Telecom reels as Vodafone bids for TelstraClear - National Business Review
Telstra is in talks to sell its fully-owned NZ subsidiary TelstraClear to Vodafone.
Telecom shares [NZX:TEL] were down 4.33% to $2.43 in late trading.
A Vodafone-TelstraClear merger would propel the pair into the $2 billion-plus revenue league.
For now, that territory is exclusively occupied by Telecom, which spun-off its Chorus network division in November as a condition of its Crown fibre deal (see "By the numbers" below).
A combined Vodafone-TelstraClear would also have more muscle in Ultrafast Broadband (UFB) negotiations with Chorus, and in content negotiations with Sky TV - a crucial area as the worlds of broadband and traditional broadcasting converge.
TelstraClear boss Allan Freeth recently told NBR ONLINE his company's T-Box partnership with Sky TV had reached a commercial "pain point" over a provision that restricts Sky TV from seeking paid content from other providers.
The first approach was made by Vodafone, according to a TelstraClear statement to the ASX and NZX.
UBS is advising TelstraClear on the deal.
The statement adds: "Discussions are continuing and there is no certainty as to whether an agreement will be reached."
'Clearly negative' for Telecom
Deutsche Bank's Geoff Zame told NBR the proposed deal was "clearly negative for Telecom if they face a more effective and integrated competitor at top end of town."
He added, "TelstraClear has good infrastructure, fibre in all metro areas, good national backhaul links, HFC [residential hybrid fibre coaxial cable] in Wellington and Christchurch and has unbundled 100-plus exchanges."
"The combination makes sense for Vodafone," Mr Zame said. It could see Vodafone grow in the corporate market "where TelstraClear has a reasonable presence and infrastructure locally [but] has been a fairly ineffective competitor for many years.Telstra never appeared willing to put much capital into it for growth so Vodafone would be a better owner."
Vodafone has strong cashflows and may use them to boost the business, Mr Zame said.
Eye on TelstraClear's corporate customers, 4G-friendly infrastructure
IDC senior research manager Peter Wise also saw Vodafone making inroads with larger customers.
"TelstraClear is traditionally strong in the corporate segment - or example it supplies telecommunications to BNZ and NZ Defence Force - while Vodafone has often struggled in this segment, other than for mobile," Mr Wise told NBR ONLINE.
"TelstraClear has a comprehensive national fibre backbone network that Vodafone could utilise to backhaul its cell tower traffic - iincreasingly important as traffic volumes grow and high speed 4G services are deployed," Mr Wise said.
Grab for $100m worth of 4G-friendly spectrum?
Telstra made a statement to the NZX confirming the talks after market rumours this morning, including tweets from Voyager Internet CEO Seeby Woodhouse.
TelstraClear has only around 50,000 mobile customers (to Vodafone's market-leading 2.5 million) - and all of them on a rebadged version of Vodafone's 3G mobile service under a wholesale deal. But it is thought Vodafone has its eye on TelstraClear's spectrum.
"TelstraClear is sitting on spectrum worth at least $100 million, including large allocations at both 1800HMz and 2100MHz," Telco2 consultant Jonathan Brewer told NBR ONLINE.
He noted that the 1800MHz band is being used by Telstra in Australia for its new 4G network.
Later this year, the government will auction 700MHz spectrum freed up by the analogue-to-digital switchover.
Telecom, Vodafone and 2degrees are among those lining up to bid for the spectrum, which can also be used for 4G cellular networks that support much faster mobile data that today's 3G networks.
No stranger to Australasian growth by acquisition
Vodafone is now stranger to growth by acquisition or merger in the region.
In 2009, it merged its Australian operation with that of Hong Kong-owned Hutchison (operator of the 3 network) to form Vodafone Hutchison Australia, trading as Vodafone Australia.
Hutchison was 10% owned by Telecom NZ - the legacy of a dead-end mobile technology alliance early last decade. Post-merger, Telecom lost its board seat, but it maintains, to this day, a 5% stake in Vodafone Australia.
Re-ignite Telecom takeover talk?
Although Telecom shares took a hit this afternoon, the Vodafone-Telstra negotiations also have potential to reignite rumours around a Telecom takeover.
Last year, in the same legislation that enabled the Chorus spin-off and the Ultrafast Broadband project, the government lifted the Kiwishare prohibition on foreign ownership of Telecom. At the time, Deutsche Bank's Mr Zame said Telecom could represent an attractive take over target for an offshore buyer.
De-mergers were more likely to create value than mergers, Mr Zame noted.
Telecom spokesman Ian Bonnar said his company was "watching developments with interest" but would not comment further.
A TelstraClear spokesman said the company had no comment beyond what was stated in its ASX/NZX notice.
By the numbers: Landline ISP business
TelstraClear is the second largest ISP by the Commerce Commission's count. The watchdog put residential market share as follows for 2011 (TelstraClear is understood to have around 200,000 ISP customers and 270,000 all up):
Telecom: 49%
TelstraClear: 16%
Vodafone: 13%
CallPlus/Slingshot: 9%
Orcon: 5%
Others: 8%
By the numbers: revenue
Vodafone NZ: In its most recently reported year (the 12 months to March 31, 2011), net profit jumped 20% to $151.5 million, a 20% increase over the $121.6 million reported in 2010. Revenue rose 6% to $1.69 billion. It was a good result for Vodafone NZ's leather-jacket-and-jeans CEO Russell Stanners.
Vodafone NZ employs around 1300 staff.
TelstraClear: In Telstra's consolidated half-year result to December 31, TelstraClear is reported making a $A9 million ebit loss - an improvement on its year-ago $A17 million ebit loss. In its standalone business unit result, reported in New Zealand dollars with intercompany costs stripped out, TelstraClear reported ebit of $1 million for the half-year, against an $8 million ebit loss for the year-ago period. Revenue fell 4% to $353 million. It was another year for TelstraClear CEO and self-styled intellectual Allan Freeth.
TelstraClear also employs around 1300 staff.
Telstra: TelstraClear's numbers are chickenfeed next to those of its Australian parent, run by the New Zealand-raised David Thodey.
For the same half-year period, Telstra reported its net profit had increased by 23% to $A1.47 billion on revenue up 1% to $A12.4 billion.
Telecom: Telecom's December 31 half-year result saw the company make an adjusted net profit of $240 million (up 51%) on revenue that fell 8.5% to $2.32 billion (excluding its Chorus division spun off in November).
Telstra bought the Clear from British Telecom in 200 to form the company now known as TelstraClear. Including debt taken on by BT, the deal was worth around $435 million.
Telecom rivalry sees NZ shares fall - ONE News
New Zealand shares fell, as the weight of Telecom, the biggest company on the exchange, held back the NZX 50 Index in the face of a region-wide rebound. Telecom rivals Telstra and Vodafone today confirmed they're in talks to consolidate their local units.
The NZX 50 fell 31.20 points, or 0.9 per cent, to 3420.79. Within the index, 28 stocks fell, 15 rose and seven were unchanged. Turnover was a lower-than-average $62 million.
Telecom fell 4.1 per cent to $2.435 after Telstra, Australias biggest phone company, said it is in talks with Vodafone over the possible sale of its TelstraClear unit in New Zealand. A tie-up would create a stronger competitor for Telecom and possibly give Vodafone an advantage in making content deals.
A deal would create "a faster competitor" for Telecom, "building a bigger company than now and with their own content and network," said Mark Warminger, a portfolio manager at Milford Asset Management.
The decline in Telecom stock would provide a buying opportunity at some point, given the company's returns and 11.8 percent dividend yield, he said.
Sky Network Television, the pay-TV operator controlled by News Corp, fell 0.6 per cent to $4.90. The company's content deals with telecommunications companies are facing scrutiny from the Commerce Commission.
New Zealand shares fell as benchmark indexes across the Asia Pacific region rose, rebounding from a weekend of bad news including US jobs and manufacturing data. Australia's S&P/ASX 200 Index was 1.3 per cent higher in afternoon trading as the Reserve Bank cut its cash rate a quarter point as expected.
Fisher & Paykel Appliances fell the most on the NZX 50, down 5.6 per cent to 51 cents as the kiwi dollar edged up from its recent lows.
Xero, the online accounting company, slipped 0.5 per cent to $4.08 after Australian rival MYOB launched a promotion with Westpac offering free website services.
Rubicon, the biotech company focused on forestry, fell 10 per cent to 35 cents after announcing a fully-underwritten one-for-three rights issue to raise $21 million. The company will also extend its US$20 million bank debt facility through to July 1, 2014.
Kirkcaldie & Stains, the Wellington department store and property group, was unchanged at $2.80 after the investment vehicle of father and son businessmen Selwyn and David Cushing disclosed its stake has risen to 19.55 per cent, near the 20 per cent level that would trigger a full takeover.
Metlifecare was unchanged at $2.08 after saying an appraisal report by Northington Partners deemed its proposal to merge with Vision Senior Living and Private Life Care Holdings is fair to the rest home operators minority shareholders.
Nuplex Industries, the specialty chemicals maker, rose 0.9 per cent to $2.23 after saying full-year earnings would be at the bottom end of its range although second-half trading has met expectations and margins have improved.
During the period, in addition to challenging market conditions, exchange rates and raw material prices have fluctuated significantly, said chief executive Emery Severin. However, with our focus on managing those elements we can control, we have seen an improvement in unit margins.
OceanaGold, the operator of the Macraes gold field, climbed 11 per cent to $2.59 as the spot price of gold held its recent gains, trading at US$1,618.04 an ounce, from as low as US$1,538.05 last month.
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