MADRID (AFP) - Spanish telecommunications group Telefonica has reported a 59.4 percent rise in sales to 5.18 billion euros (6.65 billion dollars) for January to September, powered by its O2 mobile phone unit.

The sales performance was just slightly below market forecasts of 5.25-5.72 billion euros. The firm also posted a higher-than-expected 43 per cent rise in nine-month operating revenue, coming in at 38.70 billion euros.

Nine months operating income before depreciation and amortisation (OIBDA) rose to 14.653 billion euros from 10.782 billion.

The results "continue to boost the growth profile of the company," said a company statement, which noted the "importance of diversification."

The company added it had widened its international business mix, reducing dependence on the Spanish market following acquisitions in Europe, particularly the British group O2 last February and Czech operator Cesky Telecom, which contributed 1.59 billion euros.

O2 is now contributing 12.5 percent of group revenues, worth 9.43 billion euros.

Spanish business contributed 38.5 percent of group revenues over the period, from 53 percent a year earlier while Brazil, Telefonica's second largest market, saw its contribution to group revenues decline to 14.7 from 18 percent.

The firm's mobile phones business bolstered growth in the third quarter although Brazilian unit Vivo was hit by tough trading conditions.

But in Latin America as a whole Telefonica sales rose 17.5 percent to 7.05 billion euros.

At the end of September the group had 195.9 million customers, up 33.1 percent on a year earlier.

Net debt rose 82.2 percent to 52.24 billion euros.

Last Sunday, it emerged Telefonica was taking eight percent stake in Hong Kong's dominant phone operator PCCW for some 323 million euros.