Supported by robust business in Germany, Telefonica has presented surprisingly positive business figures.

The Spanish mobile operator announced a 3.3 percent drop in net profit to 447 million euros on Wednesday. However, analysts had feared an even greater reduction to 336 million euros. At 10.26 billion euros, turnover was above market expectations, as was the operating profit of 3.22 billion euros. On this basis, Telefonica believes it is well on track to achieve its full-year targets.

Markus Haas, the head of Telefonica's recently fully acquired German subsidiary, expressed his satisfaction with the course of business in a telephone conference. "We recorded further customer growth in the second quarter and also improved our efficiency." The number of mobile phone contracts increased by 215,000 and the adjusted operating profit rose by three percent to 665 million euros.

Haas added that the cost-cutting course was paying off. His company is thus reacting to the expected losses resulting from the departure of its long-standing partner 1&1, which will in future use Vodafone's infrastructure in those areas where the United Internet subsidiary does not have its own network.

(Report by Hakan Ersen, edited by Sabine Wollrab. If you have any queries, please contact our editorial team at berlin.newsroom@thomsonreuters.com (for politics and the economy) or frankfurt.newsroom@thomsonreuters.com (for companies and markets).)