CANTV struggles to find 1Q good news

9 May 2003

Fixed line incumbent CANTV [NYSE: VNT] has reported a 10.4% decline in sales for the first quarter of 2003 to VEB648.5 billion and a devastating 73.6% drop in net income to VEB10.5 billion. The company, whose shareholders include Verizon Communications (28.5%) and Telefónica (6.9%), blamed the weak performance on continuing economic lethergy, an ongoing shift of customers to flat rate plans and a decline in the number of fixed lines. Revenues from local, long-distance and international calls declined by 12.5%, 21.5% and 33.4% respectively, although data and internet revenues managed increases of 45.3% and 20.2%. Total wirelines in service at the end of March 2003 stood at 2.69 million, while the number of wireless customers fell by 1% to 2.49 million. The decline was attributed to an average 18% tariff increase implemented in March.