Rapid expansion left France Telecom heavily indebted
France Telecom's long march back to financial health has received a further boost with news that its Orange mobile phone unit has helped it push up sales.
The company, which drove itself deep into the red with a buying spree during the 1990s boom years, said sales were up 7.3% to 11.4bn euros (£7.9bn; $12.5bn) in the January to March quarter from the same period in 2002.
Sales at Orange, whose purchase in 2000 was responsible for much of the 70bn euro debt burden, were up 9.4% to 4.2bn euros. Wanadoo sales, France Telecom's internet service provider, soared 42% to 532m euros.
The state-controlled French phone giant has so far refinanced 15bn euros in debt due this year, and raised another 15bn euros from shareholders to bolster the company's books.
The company's shares fell almost 4% after the results were announced, but had shot up yesterday ahead of the figures.
Far to go
However, France Telecom remains a long way from profitability.
The company's debt is still classed by credit ratings agency Standard & Poor's as just one step above junk.
But the agency now says it is considering an upgrade, in the wake of the 15bn euro capital increase.
And France Telecom itself insists its restructuring programme, which includes another 15bn euros in planned cost savings by 2005, is ahead of schedule.
The aim, according to Thierry Breton, the new chief executive installed in December, is to make France Telecom a "normal company" again.