The coronavirus impacts Telefónica's results. The Spanish telecommunications multinational has reduced its net profit in the first half by 53.5%, to stay at 831 million euros. The company's revenue fell to 21,706 million from January to June, 10% below the records of the same period of the previous year. The gross operating profit (Oibda) also falls conditioned by the health crisis, 18.7% in the first half of the year, to stay at 7,075 million euros.
However, "in organic terms, and in the four main markets of Telefónica, the drop in revenues and Oibda is contained in -3.8% and -6.6% respectively," the company recalled in the documentation sent to the CNMV regarding Spain, Germany, United Kingdom and Brazil, territories in which their business is turning. In fact, the Oibda-Capex (Ebitda-Investments) in those four markets has grown, 2.6% in the semester (and even 1.9% in the second quarter, totally abnormal in Spain due to the state of alarm) .
Telefónica has made significant cost savings to contain the hit of the covid-19 and has even kept pace with its continuous debt reduction, -7.5% year-on-year to 37.201 million as of June 2020.
José María Álvarez-Pallete, president of the group, highlighted that "Telefónica's behavior has been resistant, limiting the impact on revenues with a solid operational management of cost and investment control. These actions have allowed us to register, both in the second quarter as in the first half, growth in operating cash flow and margin in the four key markets and reducing debt by 7.5% year-on-year. "
The 2020 dividend is maintained at 0.4 euros per share and Telefónica maintains "the 2022 objectives of revenue growth and expansion of the operating cash flow margin", as Álvarez-Pallete has assured.
In parallel, this executive has presented a Digital Pact, "which was created with the aim of being the roadmap for the digitization of SMEs, the self-employed and public administrations, a navigation chart for the new digital world". A week before, together with the President of the Government Pedro Sánchez and within the act Digital Spain 2025, Álvarez-Pallete already claimed the need for this agreement "for digital training and education without anyone being excluded" in which the company he leads plays "an active role in helping to rebuild a more digital, productive, sustainable and inclusive society".
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