Telefónica’s Net Income Grows 38.5 Percent in 2020

Telefónica reported a net income of €1,582 million in 2020, 38.5% up vs. the previous year. Between October and December, net income reached €911 million, the highest in a single quarter since the first three months of 2019.

"2020 has been a strange year, a year in which we have been challenged. A lot was expected of Telefónica and Telefónica has lived up to these expectations. We have been side by side with the rest of society, where we had to be. We have delivered and we have continued to make progress. We had to act, we did, and the results now tell us that we were right," said Telefónica's Chairman and CEO, José María Álvarez-Pallete.

The good progress of the results throughout the year was confirmed by cash generation. While in the first six months it was limited to €1,222 million, in the second half it increased to €3,572 million, to reach a total of €4,794 million for the year as a whole. In the last quarter of 2020, free cash flow reached €1,993 million, 13.2% more vs. the same period of 2019. This increase meant that the annual figure was in line with the average for the last five years, a period in which Telefónica has generated total cash of €25 billion.

The Group's capacity to generate cash has allowed a substantial reduction in the company's indebtedness. Between October and December, Telefónica's net financial debt fell by €1,449 million, and by €2,516 million for the year as a whole. As a result, net debt ended 2020 at €35,228 million, a volume that does not include the €9,000 million (25% of current net debt) from inorganic operations pending completion.