America Movil signaled plans to step up investment in networks as its revenue and customer growth started to slow. In its Q2 report, the Latin American operator reiterated its strategy to develop fixed-mobile convergence and invest in raising the speed of its broadband networks. This will include further deployment of fibre and the roll-out of 4G mobile networks.
The company posted second-quarter revenues up 4.0 percent year-on-year to MXN 202.6 billion, while service revenues excluding currency effects increased 5.8 percent. Growth was driven by pay-TV and mobile data, while both fixed and mobile voice revenues were lower, hurt by regulatory effects.
EBITDA rose 2.4 percent to MXN 66.6 billion and increased 4.7 percent at constant exchange rates. Operating profit fell 3.3 percent to MXN 39.2 billion due to higher depreciation and amortisation of investments. Net profit was up 32.7 percent from a year ago to MXN 18.8 billion thanks to a reduction in financing costs.
Capital expenditure reached MXN 45.6 billion in the quarter, or over 22 percent of revenues, while net debt was reduced by MXN 30.9 billion to 412.3 bilion. America Movil said it raised MXN 5.7 billion in the quarter in part from selling some of its shares in Dutch operator KPN.
The operator finished the quarter with 338.7 million revenue-generating units, up by 3.0 percent from a year earlier. The mobile customer base rose by 524,000 in the three months, led by growth in Brazil and Mexico, to a total 266.9 million customers at the end of June. Fixed-line RGUs were up 1.2 million in the quarter to 71.8 million, including 309,000 new fixed telephony customers, 364,000 new broadband subscribers and 608,000 additional pay-TV clients.
In Mexico, the company's biggest fixed market, America Movil said its proposed sale of assets in order to avoid additional regulation will depend on securing regulatory approval for the deal and finding an appropriate buyer.
