Telefonica met its outlook for modest growth in 2017 and said it expects a further small increase in 2018. The Spanish operator maintained its dividend at EUR 0.40 per share in the coming year and said it will continue to work on strengthening its balance sheet.
The company's revenues were flat last year at EUR 52.01 billion, but improved 3.4 percent on an organic basis. Adjusted OIBDA rose 7.1 percent to EUR 16.19 billion, driven by expansion in Spain and Brazil. The OIBDA margin rose 2.1 percent points, or 0.6 points on an organic basis, to 31.1 percent.
Telefonica said it expects organic revenue growth of around 1 percent in 2018, despite negative regulatory effects taking an estimated 0.9 percent points off growth. The OIBDA margin should expand by another half a percent point, after regulation reduces the result by around 1.6 points. Capital expenditure is expected to fall to around 15 percent of revenue in 2017 from 16 percent last year, excluding spectrum costs.
Telefonica ended the year with free cash flow of EUR 4.95 billion, up 13 percent from 2016. Net debt stood at EUR 44.23 billion, down 9.0 percent from a year earlier.
The company confirmed it will pay the second tranche of the 2017 dividend of EUR 0.20 per share in June. For 2018, Telefonica expects a stable pay-out of EUR 0.40 per share, to be paid in equal installments in December 2018 and June 2019.
In the fourth quarter, Telefonica's organic revenue growth strengthened to 4.8 percent, to EUR 13.16 billion. Excluding regulation, sales would have rose 5.9 percent, the company said. OIBDA in the quarter jumped 22.8 percent to EUR 3.91 billion, helped by property sales in Spain and Germany.
Latin America led the increase, with organic sales up 19.9 percent to EUR 3.15 billion, followed by 3.2 percent growth in the UK. Spain's sales were stable at EUR 3.24 billion. Telefonica said average revenue per customer accelerated to 5.4 percent organic growth in Q4, led by demand for faster data and high value services, such as LTE, fibre broadband and pay-TV.
