Telemig Celular reports 40.8% drop in Q3 profits

15 Nov 2006

Brazilian mobile operator Telemig Celular Participações (Telemig) posted net income of BRL35.3 million (USD16.2 million) in the three months to 30 September 2006, down 40.8% from BRL59.6 million in the corresponding period of 2005, according to a statement from the company. Telemig, which offers mobiles services in the wealthy Minas Gerais state, reported gross revenues of BRL467 million in the period under review, up from BRL402 million a year ago. EBITDA fell by 26.2% from BRL124 million to BRL91.2 million, The EBITDA margin was 32%, down from 44.9% in 3Q 2005.

In the three-month period Telemig reported reduced net additions as a result of stiffer competition from Claro, a unit of América Móvil, ending the quarter with 804,911 contract customers, compared to 800,041 a year ago. Pre-paid users rose by 400,000 to 2.6 million, giving Telemig a market share of 33%, compared to 39% a year ago. Telemig is seen by many as a possible acquisition target, with likely buyers thought to include América Móvil, Vivo and fixed line operator Telemar.

Brazil, Telemig Celular