Telecom Italia issues profit warning amid bitter boardroom row
Telecom Italia has issued a profit warning in the latest dramatic twist for the company facing a drawn-out feud between shareholders.
The Italian company said its 2018 earnings before interest, tax, depreciation and amortisation is expected to fall by mid-single digits compared to the previous year.
The firm said the increased competition that has weighed down on its earnings was likely to carry on into 2019.
Shares in Telecom Italia dropped more than eight per cent today following the warning. The company has seen its shares plunge more than 40 per cent since May.
The update comes amid a vicious dispute between shareholders Vivendi and Elliott Management over the strategy to reduce the telecoms firm’s debt.
Last year the telecoms company ousted chief executive Amos Genish via a Whatsapp message in what Vivendi described as a “coup”.
Earlier this week Vivendi hit out at activist fund Elliott for its “time-wasting tactics” after the fund pushed back a meeting to discuss the ousting of five Elliott board members.
But Elliott has denied the claims, and said the French firm was trying to run the company for its own benefit.
“Should Vivendi continue to pursue these efforts, Elliott is confident that it will not succeed,” the company said in a statement.
Telecom Italia said its three-year financial plan will be presented to the board for approval on 21 February.