April 27, 2016 / 11:07 PM / 2 years ago

UPDATE 1-Telefonica Brasil profit nearly triples on tower sales, cost cuts

(Adds earnings details, GVT deal)

SAO PAULO, April 27 (Reuters) - Telefonica Brasil SA said on Wednesday it nearly tripled first-quarter net income from a year ago as the country’s biggest telecommunications company sold cell towers and cut costs after acquiring broadband provider GVT.

Profit rose to 1.218 billion reais ($346 million), it said in a securities filing, beating an average forecast of 1.1 billion reais in a Reuters poll of analysts. Excluding the tower sales, net income doubled to 879 million reais.

Sales edged up less than 1 percent as Brazilians’ disposable income suffered in the worst recession in decades and nearly 10 percent inflation in the past 12 months, the company said. Management squeezed spending to extract more profits, lowering operating costs by 2 percent excluding the effect of the tower sale, it added.

Nearly nine months into the integration of GVT, recurring cost savings from the deal are in line with expectations, Telefonica Brasil said in an analysts’ presentation filed to regulators on Wednesday.

Earlier in April, Chief Executive Amos Genish said the company had achieved about 30 percent of the savings forecast in 2015.

First-quarter earnings before interest, taxes, depreciation and amortization rose 24 percent to 3.789 billion reais, beating an average estimate of 3.3 billion reais.

$1 = 3.52 Brazilian reais Reporting by Brad Haynes; Editing by Chris Reese and Richard Chang

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