Mobile phone sales in Spain and Latin America have boosted the profits of Telefonica.

The Spanish company has reported a 7.2% rise in net profit for the nine months to September.

Its strong fixed-line business at home also helped to lift profits.

Spain's largest telecoms group said net profit rose to 1.59bn euros (�970m; $1.41bn), while core earnings rose by 8.5% to 9.6bn euros, in line with forecasts.

Overall sales climbed 11.2% to 23bn euros, slightly less than forecast.

The results were well received by investors and shares gained 2.7% in early trade.

Telefonica's mobile phone and internet arms, Telefonica Moviles and Terra Lycos, added 2.9% and 2.5%, respectively.

Outperforming shares

Telefonica is the biggest listed company in Spain, accounting for about a fifth of the Ibex 35 share index.

Shares have fallen about 8% this year over fears that economic trouble in Latin America, especially Argentina, could cut profits.

But Telefonica has outperformed the 30% fall in the telecoms sector of the wider Stoxx index this year, helped by having relatively lower debt than many of its major European peers.

Telefonica said Latin America was the fastest growing region in terms of new mobile phone customers, but the fall in local currencies had eroded earnings in Argentina and Brazil.