News
Mexico-based telco group cuts Telekom Austria stake; complains of aggressive competition in home market.
America Movil this week reported a rise in second-quarter revenue off the back of favourable currency fluctuations, as the telco group bemoaned aggressive competition in its home market of Mexico.
Group revenue rose 6.1% year-on-year to 233.38 billion pesos (€11.1 billion). Service revenues were up 3.2% to MXN199.81 billion, while equipment revenues jumped 27.7% to MXN33.58 billion.
"These increases reflect the appreciation of several currencies versus the Mexican peso in the period, particularly the Brazilian real and the Columbian peso. At constant exchanges rates, service revenues were down 2.1% year-on-year," America Movil said in a statement on Thursday.
America Movil said broadly all of its operating units saw revenue growth in local currency terms.
"In Mexico, however, we saw a step down in revenues brought about mostly by more aggressive commercial plans in the prepaid segment as a greater part of our subscribers moved towards unlimited call plans," the company said.
Revenue in Mexico fell 4.3% year-on-year to MXN65.12 billion. Wireless revenues fell 6.7% to MXN41.88 billion, while fixed-line revenue edged up 1.6% to MXN25.12 billion. EBITDA in Mexico plunged 23.7% to MXN21.5 billion.
America Movil did not name names, but it is clearly feeling the heat from AT&T.
"The Mexican mobile market has become very competitive as other operators try to buy market share…with plans that are substantially cheaper than the ones they offer in their home market," America Movil said. "They have led the market in the direction of unlimited usage of some services at a low cost."
The performance in Mexico drove a 10.7% decline in America Movil’s group EBITDA, which came in at MXN60.98 billion. Net income plummeted to MXN7.7 billion (€367.45 million) from MXN14.05 billion a year earlier.
Separately on Thursday, America Movil revealed it has cut its shareholding in Telekom Austria.
The company sold a 7.8% stake in the Austrian incumbent, reducing its shareholding to 51.89% from 59.70%.
