RPT-Czech Telefonica net profit seen up 8 pct in Q1

...

* Telefonica O2 Czech Republic Q1 earnings.

* April 26, after the market close at 4 p.m. (1400 GMT).

* Net profit seen rising 8 percent year-on-year to 2.22 billion crowns, according to the average forecast in the poll.

By Jan Korselt

PRAGUE (Reuters) - First-quarter net profit is set to jump 8 percent year-on-year at Telefonica O2 Czech Republic as solid mobile revenue growth helped offset the costs of launching a cellular unit in Slovakia, a Reuters poll showed on Monday.

The survey of eight analysts showed an average market expectation of a 2.22 billion crown ($107.9 million) net profit on a 2 percent increase in sales to 15.12 billion crowns.

"We expect mobile revenue growth to have more than offset the decline in fixed-line revenues," said Vera Sutedja, analyst at Erste Bank.

"Nevertheless, start-up costs in Slovakia and, to a lesser extent, rebranding costs, should have weighed on Telefonica O2's OIBDA (operating earnings before depreciation and amortisation)," she added.

Czech Telefonica, majority-owned by Spain's Telefonica , rolled out mobile operations in Slovakia in February and signed up 200,000 customers by end-March, which added 311 million crowns to overall sales, said analysts at Atlantik FT.

A decline in depreciation costs thanks to lower investments and a drop in interest expenses should beef up overall profitability and partly compensate for the falling OIBDA at the group, said Atlantik FT analyst Milan Vanicek.

Telefonica O2, rebranded from Cesky Telecom last year, trades at 21 times forecast 2007 earnings, according to Reuters Estimates. That is a premium to the pan-European DJ Stoxx Telecoms Index , which shows a multiple of nearly 15.

Average Median Q1-06 Range REVENUE 15.12 15.11 14.83 14.96-15.35 CORE PROFIT (OIBDA) 6.91 6.83 7.19 6.69- 7.52 OPER.PROFIT (EBIT) 3.03 2.95 3.02 2.83- 3.62 NET PROFIT 2.22 2.20 2.05 2.05- 2.66

NOTE - The following equity houses took part in the poll: Atlantik FT, BH Securities, Erste Bank/Ceska Sporitelna, Komercni Banka, Morgan Stanley, KBC Securities/Patria Finance, Raiffeisenbank, Wood & Company.

($1=20.58 Czech Crown)

For main central European company news, double click on [.CEE] E.Europe hot stocks [HOT-EEU] Main E.Europe news [TOP/EAST] Related stories on [HU] [PL] [CZ] [EEU-STX] [EEU-RES] [EEU-E] For real-time index quotes, double click in brackets: Warsaw WIG20 Budapest BUX Prague PX50

Keywords: TELEFONICA02CR RESULTS/