(Associated Press via NewsEdge) Swisscom said that second-quarter net profit dropped to 299 million Swiss francs ($244 million) from 596 million francs ($486 million) in the year-earlier period.
Switzerland's largest telephone company attributed the decline in part to a fine of 180 million francs ($147 million) for overcharging termination fees.
Sales dropped to 2.4 billion francs ($1.96 billion) from 2.47 billion francs ($2 billion) in all of its main business lines.
'Despite a challenging first half-year 2006, we were once more able to defend our position successfully against our competitors,' the company said in a letter to shareholders. 'The telecoms sector is currently being driven by new customer requirements for convergent services, the ongoing rapid pace of technological change, and increasing regulation.'
Swisscom said it now expects net earnings of 3.7 billion francs ($3 billion) in the full year, compared with an earlier estimate of around 4 billion francs ($3.2 billion).
The charge followed a decision by a Swiss court to approve price reductions ordered by the Swiss Communications Commission, which said Swisscom had overcharged on certain interconnection services between its fixed line unit and other telecommunications providers between 2000 and 2003.
Swisscom further said it expected a lower operating income contribution from Swisscom IT Services.
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