LONDON (CNNfn) - Mannesmann bolstered its defense against the hostile takeover approach from Vodafone AirTouch Friday, unveiling strong growth in earnings for 1999.|
Duesseldorf-based Mannesmann reported a 22 percent increase in revenue to 23.2 billion euros ($24 billion) while underlying earnings jumped 37 percent to 4.3 billion euros. The firm's telecom activities boasted a 70 percent gain in earnings to 2.2 billion euros. Recently-acquired Orange contributed a net 100 million euro deficit due to write-offs associated with the financing of the $36 billion deal. Pretax profit rose 8 percent to 1.4 billion euros.
Chairman Klaus Esser claimed "another year of quite extraordinary success" for Mannesmann’s telecom business, which signed up 70 percent more cellular subscribers in 1999. The rest of the firm's profit came from the engineering and automotive unit, which is due to be spun off this year.
Mannesmann (FMMN) stock reacted brightly to the numbers, gaining 2 percent to 214 euros in Frankfurt, although they remain well below the value of Vodafone's $126 billion all-stock offer, currently worth 236 euros per share.
The company's net profit, not released at this preliminary stage, will be lower than in 1998 - as previously announced - due to an increase in the tax rate.
Underlying earnings exclude interest, taxes, depreciation and amortization.