Brazil/Telemar CEO -2: Departure As Bad Debts Spike
Dow Jones Online News, 07/20/2001 07:57
SAO PAULO -(Dow Jones)- Brazil's Tele Norte Leste Participacoes SA (TNE) Friday named Vice President Jose Fernandes Pauletti interim chief executive.
Telemar, as Brazil's biggest phone company is known, said operations head Pauletti will replace outgoing Chief Executive Manoel Horacio Francisco da Silva on July 31.
Market players said Horacio was forced out by shareholders disappointed with Telemar's financial performance.
To expand nationwide or start offering wireless services in January, Telemar has been racing to meet the government's 2003 network expansion targets for regional fixed-line carriers ahead of schedule, by the end of 2001.
But the expansion drive that has boosted the company's number of installed lines to 15.9 million has had nasty consequences.
Telemar said its bad debt levels hit 4.6% of gross revenues for the second quarter, higher than the 4.3% expected and up from 1.8% a year ago.
In the first half of the year, the carrier had net revenue of 4.744 billion reals ($1=BRR2.50), compared with BRR3.8 billion a year ago.
Capital expenditures were BRR4.1 billion in the first half, compared with BRR736 million a year earlier. The company's headcount increased by 3,500 employees to 21,795 during the quarter in order to meet the targets.
-Terry Wade, Dow Jones Newswires; 5511.3145.1479; terry.wade@dowjones.com
(This story was originally published by Dow Jones Newswires)
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