News
Mexico-based telco group reports €272 million net loss in last three months of 2016, talks up postpaid customer additions.
America Movil posted a net loss equivalent to hundreds of millions of euros in the last three months of 2016, its balance sheet hit by financing costs and the impact of a weak Mexican peso.
The Mexico-based telecoms group said its net loss in the fourth quarter reached MXN5.97 billion (€272 million), compared with a profit of MXN15.66 billion in the year-ago period, as its comprehensive financing costs came in at MXN28.2 billion, up from MXN9.78 billion.
That net loss was the telco’s largest in 15 years, according to Reuters.
America Movil’s MXN25.8 billion operating profit represented a 20.1% year-on-year decline, while EBITDA grew by 2.9% to MXN65.68 billion, but declined by 8.1% in constant currency terms.
"As service revenues recover, EBITDA growth will stabilise in relative terms," the firm said. Q4 service revenues grew by 0.7% at constant exchange rates to MXN223.51 billion, which represented their best showing of the year thanks to mobile data revenue growth of 11.7%, the company said.
Overall revenues grew by 16.9% to MXN269.34 billion.
"The relatively high revenue increases seen in Mexican peso terms are to a large extent the consequence of the Mexican peso having depreciated vis-à-vis the currencies of all other operations," the operator said.
The peso depreciated by 17% compared with the U.S. dollar and 14.3% against the euro.
At constant rates revenue growth was 3.7%.
Currency effects also hit the operator’s debt burden. It ended 2016 with net debt of MXN630 billion, up from MXN582 billion a year earlier.
America Movil’s mobile operations, which span Latin America, the U.S. and Europe, reported the loss of 3.3 million lines last year to close with 280.57 million, but the operator was quick to point out that it disconnected inactive prepaid users in a number of markets, including Brazil, Panama, Costa Rica, Croatia and Macedonia.
On the postpaid side, it added 1.3 million customers in Q4, led by Brazil, where it recorded net additions of 1 million. In its home market, where competition has intensified following the arrival of AT&T, it added 229,000 postpaid customers, and its Colombian operations recorded 148,000 net adds.
