EARNINGS POLL-Czech Telefonica Q2 net profit seen up 10 pct

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* Telefonica O2 Czech Republic earnings.

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

* Net profit seen rising 10 percent year-on-year to 2.44 billion crowns according to the average forecast in the poll

By Jan Korselt

PRAGUE - Net profit at Telefonica O2 Czech Republic is expected to rise 10 percent in the second quarter, with mobile and data services growth outweighing sluggish fixed-line performance and the costs of launching a Slovak branch, a Reuters poll showed on Friday.

The average of eight analysts forecasts for net profit was 2.44 billion czech crowns ($119.3 million) compared with 2.23 billion in the second half of 2006. Revenues are expected to be 15.67 billion, up 3 percent year-on-year.

For the first six months, this would represent an 11 percent increase in net profit to 4.75 billion crowns, according to Reuters calculations, with revenues 3 percent higher at 30.85 billion crowns.

"We expect the fixed-line deterioration to be offset by an aggressive broadband roll-out, IPTV evolution and introduction of new attractive services and convergent products," said Aleksandra Kostrzewa, an analyst at KBC Securities.

Operating costs before interest, tax, depreciation and amortisation (OIBDA) are expected to be 2 percent lower in the second quarter due to higher marketing costs and expansion in Slovakia, the poll showed.

The Czech operator, majority-owned by Spain's Telefonica , rolled out mobile operations in Slovakia in February and introduced post paid services in May.

Telefonica O2, rebranded from Cesky Telecom last year, trades at 19 times forecast 2007 earnings, according to Reuters Estimates. That represents a premium to the pan-European DJ Stoxx Telecoms Index , with a multiple of nearly 15.

"Telefonica (CR) is becoming a mature company with stable, but slow growth. Anyway, recently won government contracts and a planned real estate disposal will have a positive impact on value creation in the future," Kostrzewa from KBC said. ---------------------------------------------------------------- Analysts' estimates for Q2/2007 (in bil CZK):

Average Median Q2-06 Range REVENUE 15.67 15.64 15.28 15.46-16.00 CORE PROFIT (OIBDA) 7.18 7.16 7.31 7.09- 7.34 OPER.PROFIT (EBIT) 3.33 3.34 3.04 3.20- 3.56 NET PROFIT 2.44 2.43 2.23 2.32- 2.59 ---------------------------------------------------------------- Average estimates for H1/2007 based on Reuters calculation:

Average H1/2006 REVENUES 30.85 30.10 CORE PROFIT (OIBDA) 14.22 14.51 OPER.PROFIT (EBIT) 6.51 6.06 NET PROFIT 4.75 4.28 ----------------------------------------------------------------

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

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Keywords: TELEFONICACZECH RESULTS/