* Expects annual savings of 80-90 mln euros
* Net profit 63.4 million euros after merger costs of 61 mln
* EBITDA stable at 537 mln euros, in line with forecast
* Shares rise 7 percent
LISBON, Feb 28 Portuguese telecoms firm Zon
Optimus said savings from the merger that created it
could be almost double its initial forecast and offset
restructuring costs this year, sending its shares sharply
In its first annual results since Zon Multimedia and
Sonaecom's mobile phone unit Optimus merged early last
year, the company said 2013 profit was hit by the costs from the
tie-up as well as fierce competition.
Speaking to analysts, Chief Financial Officer Jose Pedro
Pereira da Costa put annual savings from the deal at 80-90
million euros ($109-123 million) from this year, up from the
firm's previous forecast of 45-50 million euros. The savings
would be made mainly in infrastructure and network convergence.
He also told Reuters there would still be restructuring
costs linked to the merger this year and next, but the benefits
of the joint operation should be slightly higher in net terms
Zon Optimus shares were up 7 percent at 5.56 euros at 1118
GMT, outperforming a 0.4 rise in the broader Lisbon market
Net profit for 2013 was 63.4 million euros, about half the
level of the combined pro-forma earnings of 2012 for the two
firms that merged.
Earnings were weighed down by restructuring costs of 61
million euros, without which the company said the profit would
have been "similar to the previous year".
At the operating level, earnings before interest, taxes,
depreciation and amortisation (EBITDA) were almost flat at 537
million euros, while revenues dropped 3.2 percent to 1.474
billion euros - both in line with analysts' expectations.
"The pressure of the macroeconomic situation continues to
impact the communications business of Zon Optimus," it said,
referring to Portugal's recession, but adding cost discipline
and efficiency gains allowed it to keep EBITDA stable.
Although the country started to emerge from its worst
recession since the 1970s last year, the economy still
contracted 1.4 percent in 2013. The government expects the
economy to grow at least 0.8 percent this year when the country
is to move on from its 2011 international bailout.
Zon Optimus competes against former monopoly Portugal
Telecom and the local unit of Britain's Vodafone
in a depressed market where the companies have been
waging a price war to win customers.
Portugal Telecom this month reported a 35 percent fall in
net profit for the last quarter of 2013, hit by the tough
Despite the fledgling economic recovery in Portugal, the
corporate segment of the market was affected by cost cuts at
companies and state institutions and results suffered from
intense price competition, Portugal Telecom said.
($1 = 0.7309 euros)
(Reporting By Daniel Alvarenga; Writing by Andrei Khalip;
Editing by Pravin Char)