MEXICO CITY -(Dow Jones)- Mexican communications giant America Movil SAB (AMX, AMX.MX) said Tuesday that its net profit fell 4.7% in the fourth quarter to 24.2 billion pesos ($2 billion) as higher depreciation charges offset gains in revenue and operating cash flow.
Latin America's largest wireless service provider said its revenue in the October-December quarter was MXN162 billion, up 6% from the year-ago quarter. America Movil began consolidating the results of fixed-line company Telefonos de Mexico SAB (TMX, TELMEX.MX) and Telmex Internacional SAB (TELINT.MX) in the third quarter of last year, and adjusted the year-ago results to reflect the consolidation.
Operating cash flow measured by earnings before interest, taxes, depreciation and amortization, or Ebitda, rose 4.8% to MXN61.2 billion.
Revenue beat the median forecast of MXN159.16 billion from six equity analysts consulted by Dow Jones Newswires, while Ebitda was below the estimate of MXN63.8 billion, and net profit was just shy of the MXN24.95 billion forecast.
"The year 2010 ended on a relatively strong note, with the South American economies expanding rapidly and the U.S. and Mexico showing increasing signs of an economic recovery, all of which helped bring about a reacceleration of subscriber growth in the Americas," America Movil said in a release.
America Movil said it added 8.2 million wireless subscribers in the quarter, bringing its total to 225 million. Mexico unit Telcel added 1.7 million to 64.1 million, while Brazil added 2.9 million subscribers to 51.6 million. Total accesses, including fixed lines, TV and Internet subscriptions, were 276.5 million, up 12.1% from the end of 2009.
America Movil said its net profit was affected by higher depreciation costs, particularly in Colombia and Brazil, as it took measures to reflect "the impact that the rapid rate of technological innovation has on both the market values of various types of telecommunication equipment, and the need to phase out older technologies."
The higher depreciation charges took MXN3.9 billion off net profit, the company said. A deferred tax credit in Brazil also affected the net result.
America Movil L shares traded on the Mexican stock exchange closed flat Tuesday at MXN34.54, compared with a 12-month high of MXN36.42 and 12-month low of MXN28.13.
Latin America's largest wireless service provider said its revenue in the October-December quarter was MXN162 billion, up 6% from the year-ago quarter. America Movil began consolidating the results of fixed-line company Telefonos de Mexico SAB (TMX, TELMEX.MX) and Telmex Internacional SAB (TELINT.MX) in the third quarter of last year, and adjusted the year-ago results to reflect the consolidation.
Revenue beat the median forecast of MXN159.16 billion from six equity analysts consulted by Dow Jones Newswires, while Ebitda was below the estimate of MXN63.8 billion, and net profit was just shy of the MXN24.95 billion forecast.
"The year 2010 ended on a relatively strong note, with the South American economies expanding rapidly and the U.S. and Mexico showing increasing signs of an economic recovery, all of which helped bring about a reacceleration of subscriber growth in the Americas," America Movil said in a release.
America Movil said it added 8.2 million wireless subscribers in the quarter, bringing its total to 225 million. Mexico unit Telcel added 1.7 million to 64.1 million, while Brazil added 2.9 million subscribers to 51.6 million. Total accesses, including fixed lines, TV and Internet subscriptions, were 276.5 million, up 12.1% from the end of 2009.
America Movil said its net profit was affected by higher depreciation costs, particularly in Colombia and Brazil, as it took measures to reflect "the impact that the rapid rate of technological innovation has on both the market values of various types of telecommunication equipment, and the need to phase out older technologies."
The higher depreciation charges took MXN3.9 billion off net profit, the company said. A deferred tax credit in Brazil also affected the net result.
America Movil L shares traded on the Mexican stock exchange closed flat Tuesday at MXN34.54, compared with a 12-month high of MXN36.42 and 12-month low of MXN28.13.
By telecom Global expert
himanshu gupta
telecominfo.in
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