America Movil Registers Small Second-Quarter Net Loss -- Update
17 Julio 2018 - 7:06PM
Noticias Dow Jones
By Anthony Harrup
MEXICO CITY -- Latin America's largest telecommunications
company, América Móvil SAB, had a small net loss in the second
quarter as foreign-exchange losses from a weaker Mexican peso
offset increases in revenue and operating profits.
The company controlled by billionaire Carlos Slim on Tuesday
reported a net loss of 236 million Mexican pesos ($12.5 million),
compared with a net profit of 14.3 billion pesos a year
earlier.
Revenue in the April-June quarter rose 3.2% to 257.3 billion
pesos, with service revenue in local currencies up 2%. Earnings
before interest, taxes, depreciation and amortization -- a measure
of operating cash flow -- rose 3% to 72 billion pesos. Operating
profit was up 4.8% at 32.6 billion pesos.
The Mexican peso weakened against the U.S. dollar during the
second quarter as a result of rising U.S. interest rates, investor
caution over the future of talks to renegotiate the North American
Free Trade Agreement with the U.S. and Canada, and Mexico's July 1
presidential election.
The resulting exchange losses led the company's financial costs
to more than double, to 32.2 billion pesos, contributing to the
negative net result.
Revenue beat the median expectations of 254.3 billion pesos
among analysts polled by The Wall Street Journal, who also expected
a net profit of 12.2 billion pesos and Ebitda of 71.9 billion
pesos.
América Móvil, which operates in Latin America, the U.S.,
Austria and parts of Eastern Europe, ended the quarter with 279
million wireless lines and 83.4 million subscriptions to fixed-line
services including telephones, pay TV and broadband internet.
The number of wireless customers was little changed from a year
earlier, although the company continued to gain contract
subscribers while disconnecting prepaid lines as people use more
mobile data and make fewer calls.
"Service revenue growth in the mobile space was remarkable both
in Brazil and Mexico, 11.9% and 8.7% respectively," América Móvil
said.
Ebitda in Mexico grew 14.9%, its biggest increase in nearly 11
years, and in Brazil it rose 9.9%, the sharpest gain in almost
three years.
In Mexico, where mobile unit Telcel competes with AT&T Inc.
and Spain's Telefónica SA, the company has been recovering margins
that were squeezed by regulatory measures against América Móvil as
the dominant wireless and fixed-line carrier.
Telcel pays more to connect its customers to rival networks than
it charges for receiving incoming calls, and fixed-line unit Telmex
has been ordered to separate wholesale and retail services.
"Following our recent meeting with the company, we emerged
encouraged that incremental regulatory pressures over the near term
are unlikely," Barclays analysts said in a recent note. "With the
competitive environment largely stable, focus will likely continue
to center on prospects for margin expansion in Mexico."
Write to Anthony Harrup at anthony.harrup@wsj.com
(END) Dow Jones Newswires
July 17, 2018 19:51 ET (23:51 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.