France Telecom-Orange reported falling revenues and profits for the first half of 2012, despite managing to grow in Spain.

The operator saw overall revenues decrease 3.2 percent to €21.8 billion, while profit was down 9.5 percent to €1.9 billion.

“Against the backdrop of a difficult macro-economic environment, I would like to emphasise the robustness of our first-half results, particularly the resilience of our French mobile operations which showed a marked improvement from the first quarter with a return to growth in the contract customer base in June,” commented chairman and CEO Stéphane Richard (pictured).

Revenues in France were down 4.2 percent to €10.9 billion, but the company said it had stabilised its market share on the mobile market.

This was estimated at 38.1% at 30 June, compared with 38.3% at the end of March.

The second quarter net loss of customers (-155,000) was one fourth of that in the first quarter, it added.

FT-O and its established rivals have been under pressure from new entrant Free Mobile, which launched in January.

In May, Free said it won 2.61 million subscribers and four percent of the French mobile market.

Revenues in the company’s Poland business unit were down 11 percent to €1.7 billion, while the rest of world division saw a fall of 3.2 percent to €4.1 billion.

Its enterprise division was also down – it recorded a fall of 1.7 percent to €3.5 billion.

Surprisingly, Spain proved to be the main bright spot in the results; revenues there grew 2.3 percent to €1.9 billion.

The number of mobile customers grew in Q2 while churn was down for the first time in four quarters. 

However, mobile ARPU continued to fall as did the number of fixed customers.

“In Spain, Telefonica’s revenues fell by 12.7% and Vodafone’s by 17.8%. Clearly, France Telecom has managed its business in Spain better than others,” said Ovum’s Emeka Obiodu.

Unusually, the chairman and CEO also made a pointed reference to the company’s working conditions.

“The latest results from our internal employee satisfaction survey testify to the improved work environment and greater cohesion within the Group,” he said.

Earlier this month, FT-O was indicted for psychological harassment relating to a number of staff suicides that took place in 2008 and 2009.

The operator denies implementing a policy aimed at deliberately creating stress and causing employees to resign.

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