Paris: France Telecom SA said it sees a drop in profit margins this year as it gears up for a mobile-phone rival in its home market in 2012.

FRENCH stocks including France Telecom SA gained yesterday. Michelin & Cie. fell after targeting a 2006 operating margin that will be about the same as last year.

France Telecom SA plans to raise as much as €1.79 billion by selling a stake in its yellow pages unit in the biggest French initial public offering since 2002.

NOKIA, the world’s largest mobile phone maker, said fourth-quarter profit topped its earlier forecasts as sales of wireless networks and handsets beat expectations.