LONDON (CNNfn) - Mannesmann, the diversified German industrial group, reported a sharp rise in first-half profits Thursday as it completes its transformation into a leading telecom provider.
The company said group net profit rose in line with expectations, climbing 10 percent to 250 million euros ($270 million) from 227 million. Operating profit advanced 25 percent to 735 million euros ($792 million) from 586 million a year earlier.
Mannesmann, which also produces machine and auto components, has expanded its fixed-line and cellular operations in Germany through its Mannesmann Arcor arm. It now is the country's largest mobile operator and the second-largest fixed-line provider after Deutsche Telekom.
The company said that while full-year pre-tax earnings will be boosted by the telecom operation, the acquisition of two mobile companies in Italy from Olivetti will generate higher goodwill charges. Total telecom profits advanced 82 percent during the first half.
The shares were off 4 percent at 130.20 euros in a widespread sell-off in Frankfurt after losing 2 percent Wednesday. However, the shares have outperformed the local market, rising 55 percent since the start of the year.
Total sales climbed 7 percent to 9.741 billion euros, with telecom-related revenues up 34 percent.