Telecommunications company France Telecom said Thursday that first half net profit fell 4.3 percent as the economic crisis caused customers cut back on phone calls and data transfers — and warned that conditions will get tougher in the second half.
The company, whose largest shareholder is the French state, reported net profit of euro2.56 billion ($3.60 billion) in the six months through June compared with euro2.67 billion in the first half of 2008.
The French telecommunications giant reported a 0.5 percent decline in revenues to euro25.46 billion.
The company confirmed its previous guidance of euro8 billion in what it calls organic cash flow this year. "For the second half, with the economic environment remaining difficult, the Group will continue with targeted marketing programs and cost reduction efforts," said Chief Executive Didier Lombard said in a statement.
The company said its expects "the level of business activity in the second half of 2009 should be slightly lower" than the first half.
It also said that regulatory measures such as the reductions in mobile call termination rates — the charges paid by operators to connect calls to mobiles — that are being introduced in France, Poland and Spain will also hurt.