France Telecom has posted a sharp drop in 2006 profits after it was hit by restructuring and falling prices in top markets.
The operator, which trades mainly under the Orange brand, reported a net profit of €4.14 billion for the 12 months to December 31st, down from €5.7 billion in 2005.
The outcome included restructuring costs of €567 million and an impairment charge of €2.8 billion, mostly related to a drop in the value of its struggling UK mobile business.
France Telecom saw its full-year operating profit fall to €6.9 billion from almost €10.5 billion in 2005.
The company also fuelled speculation it was saving up for acquisitions by keeping its dividend stable.
France Telecom - which also operates in Britain, The Netherlands, North Africa and the Middle East - said it was looking for acquisitions in emerging markets, including Asia.