France Télécom reported revenue up 1.5 percent for the first half of the year, with growth strongest in its mobile communications division.

Consolidated revenue for the half-year totalled ¬26.3 billion (US$41.5 billion as of June 30, the last day of the period reported), up 1.5 percent on the same period last year.

However, the company suffered from exchange rate changes, and sold off its mobile and Internet operations in the Netherlands during the year. At constant currency rates the company's continuing operations grew 3.9 percent, the company said Thursday.

Net income declined to ¬2.7 billion for the half-year, from ¬3.3 billion a year earlier. Excluding the effect of nonrecurring items, income rose 4.4 percent to ¬2.5 billion.

France Télécom's mobile division, personal communication services, accounts for over half the company's revenue: ¬14.4 billion for the half-year. Excluding the effect of exchange rate fluctuations and the sale of mobile operations in the Netherlands, that's a growth rate of 7 percent.

Fixed-line revenue in the home communication services division grew more slowly, up 0.3 percent on a comparable basis. The 29 percent year-on-year growth in broadband services was offset by continuing decline in traditional telephony services.

Enterprise communication services revenue continues to grow more slowly than the company as a whole. At ¬3.8 billion, it rose just 1.1 percent year on year, or 2.9 percent excluding currency effects and discontinued operations -- its best performance in the last 18 months. The company sees the strongest growth in what it calls extended business services, primarily consulting and service management activities.

Looking ahead, the company is counting on Apple's iPhone 3G to boost mobile revenue in the second half. The company has the exclusive right to distribute the phone in France, and is also an authorized distributor in Poland and a number of the other countries in which it operates.