Telefonica was more cautious about its growth prospects in the year ahead after restructuring costs and slowing revenues contributed to a halving of the Spanish telecom group’s net profit for 2011. Under pressure to reduce a 57 billion euros ($76 billion) debt mountain in a sluggish economic climate, Telefonica said it now sees revenues growing at least 1 per cent in the year ahead, at the bottom end of a three-year range seen a year ago. It also kept unchanged its closely-watched dividend, and its debt-to-core earnings (OIBDA) ratio target at 2.35 times. At present, net debt to OIBDA is at 2.46 times. Profit at the euro zone’s largest telecom fell 47 per cent to 5.40 billion euros, exceeding a forecast for 4.46 billion in a Reuters poll thanks to an unexpected accounting gain related to last year’s purchase of Brazil’s Vivo. Revenues were in line with expectations, up 3.5 per cent. Telefonica is struggling to convince sceptical investors that a December dividend cut is enough for it to meet a tough debt reduction programme while revenue growth is weak. Some analysts noted that the company had now rejigged its debt guidance slightly, and even so had barely met its previously stated criteria for net debt plus commitments to be no more than 2.5 times OIBDA.