UPDATE 3-Telefonica shows some turnaround signs in Spain
* Spain shows signs of rebound, not translating into profit
* Underlying business improves in most other markets
* But currencies, lower margins weigh on results (Adds details on Spain, updates share price)
By Julien Toyer and Andrés González
MADRID, July 31 (Reuters) - Telefonica SA gained new customers in Spain at a faster pace in the second quarter, an early sign of a turnaround from a three-year slump that wiped out more than one third of revenue and core profit in its biggest market.
Spain has been the weak spot for Europe's biggest telecoms firm by revenue as cash-strapped consumers cut spending on mobile, internet and television services during a deep recession that ended last year.
However Telefonica's second-quarter results on Thursday showed evidence that recent investments in high-cost fibre optic networks and packages that combine mobile and fixed-line phones, high-speed Internet and TV could be starting to pay off.
The company, which has agreed to buy Prisa's pay-TV business Canal+, said 348,000 new clients had signed to its TV packages in Spain in the second quarter and it had gained mobile subscribers in the country for the first time in three years.
It also said it had now connected 5 million homes to its Spanish fibre network and that the service has 861,000 clients, after new sign-ups increased by 70 percent from the first quarter. Continuación...