France Telecom, Europe's second-largest telecoms company, on Tuesday announced a sharp rise in its 2005 net profit along with massive job cuts.

In a statement, France Telcom said its net profit rose by 89 percent to 5.71 billion euros (6.79 billion U.S. dollars) in 2005 from 3.02 billion euros (3.59 billion U.S. dollars) in 2004.

The statement came after the company reported a sharp fall in its share prices, which have lost 10 percent of their value already in 2006, and have fallen 23 percent over the past 12 months.

To meet investors' demand to return more money to shareholders, the company said it would pay between 40 percent and 45 percent of its cash flow for its annual dividend.

In an effort to reduce costs, the company would cut 17,000 jobs from its 200,000-strong work force over the next three years, according to France Telecom Chief Financial Officer Gervais Pellissier.

France Telecom, one of the world's largest providers of high-speed Internet and mobile phone services, also plans to integrate mobile and fixed-line services in a bid to keep its clients and prevent cheaper, more flexible telecom companies from eroding its profits.

Source: Xinhua