Companies in the UK and Spain push Telefónica accounts to the 'red' level

Spanish telecommunications company Telefónica lost 892 million euros last year, closing its accounts in the “red” zone, something that has not happened since 2002.

According to the Spanish press, the negative result is due to the impact of a reduction of 3.107 million pounds sterling (3.6 billion euros) in the Virgin Media O2 subsidiary and also the cost of the redundancy plan in Spain in the range of 1,3. One billion euros with a reduction of 3,400 workers.

With a total weight of 4.386 million euros, these two amendments in 2023 pushed the accounts into negative territory. Excluding these adjustments, the telecom operator will have a turnover of 2,369 million euros, an annual increase of 17.1% compared to 2022.

These two transactions alone represented a fourth-quarter loss of 2,154 million. However, the last three months showed profits of €730 million.

These numbers come at a time when Saudi Telecom bought 9.9% of the company’s capital, even though it did not obtain permission from the Spanish government to exceed the 5% level. The Spanish state also acquired 10% of the company, becoming the largest shareholder.

Despite this significant weight, Telefónica has maintained a positive growth trajectory. Last year, the company generated revenues of 40,652 million euros, 1.6% higher than in 2022, and the highest sales figure since 2020. However, in the fourth quarter alone, sales reached 10,153 million euros.

The telecom company notes that its enterprise business has consolidated in 2023, becoming a growth lever, after noting a 6.3% organic increase in revenues.