Portugal's NOS net profit slumps two-thirds as pandemic bites

LISBON (Reuters) - Portuguese telecoms company NOS NOS.LS reported that its first-half net profit fell 61% to 35 million euros (31.8 million pounds) on Wednesday, attributing the result to losses from cinemas, roaming and subscription services.

NOS provided customers with premium services such as sports channels for free throughout the second quarter, hammering its revenues, while a drop in roaming use because of a lack of tourists also affected its results.

The company’s cinema network took a big hit with theatres closed from the 16 March throughout the second quarter, reopening on 2 July but with big premieres delayed and health and safety restrictions in place for cinemagoers.

Overall, its revenues fell 7.6% to 666.6 million euros while earnings before interest, taxes, depreciation and amortization fell 6.3% to 310.6 million, the company reported.

“The results can be explained by the effects of the COVID-19 pandemic, by the increase in non-recurring costs in the form of provisions to counter the increase in bad debt incurred in the first quarter, among other things,” the company said.

Family consumption of NOS’ services remained stable, the company said, but its customer base of small and medium-sized enterprises faced increased pressure due to the partial or complete closure of their activities during lockdown.

“This semester was one of the most challenging in NOS’ short history,” Chief Executive Miguel Almeida said in a statement, adding that the near future would continue to be difficult.

“The impact of the pandemic which began at the end of February intensified in the second quarter of the year due to lockdown.”

Reporting by Victoria Waldersee, Sergio Goncalves, Editing by Nathan Allen and Hugh Lawson