Telecom Argentina reports 3Q results

12 Nov 2007

Incumbent multi service operator Telecom Argentina posted net profits of ARS227 million (USD72 million) in the third quarter of 2007, more than the ARS65 million earned in 3Q 2006, reports BNamericas. Telecom’s revenues for the three months ended 30 September 2007 were ARS2.31 billion, 22% up on the ARS1.89 billion seen in the corresponding period last year. The fixed line division accounted for revenues of ARS586 million in 3Q 2007, a modest 4% increase year-on-year, while sales in the broadband sector were ARS134 million, up 22%, and revenue from the data segment was ARS45 million, growth of 18%. Cellular subsidiary Personal earned 3Q revenues of ARS1.37 billion, up 32% on the year ago figure.

Telecom’s total net profit for the first nine months of 2007 was ARS614 million, almost a fourfold increase compared to the ARS164 million reported in the same period in 2006. Meanwhile, revenues in January-September climbed 24% to ARS6.52 billion from ARS5.24 billion the year before.

At 30 September 2007, Telecom had 4.17 million fixed lines in service, a 3% increase in twelve months from 4.05 million at 30 September 2006. Meanwhile the telco reported 677,000 ADSL subscribers at end-3Q 2007, an increase of 81% compared to end-3Q 2006. Personal reported 10.2 million mobile subscribers in Argentina at 30 September, 67% of whom took a pre-paid service. 97% of the Argentine subscriber base was using Personal’s GSM platform, with the remainder on CDMA technology. In neighbouring Paraguay, where Personal operates under the Nucleo banner, the customer base reached 1.5 million on 30 September 2007, of which 89% were pre-paid and 85% used GSM services.

Telecom’s total CAPEX for the first nine months of 2007 was ARS981 million, up 30% from the ARS755 million in the period January to September 2006. ARS555 of this was spent by the fixed line business (including broadband), and mobile telephony accounted for the remaining ARS426 million. Of the cellular investment, ARS377 million went in Argentina and ARS49 million in Paraguay.

In a conference call with investors, company officer Pedro Insussary said, ‘The fixed line business continues to benefit from strong demand for broadband services while the traditional voice business shows single-digit growth…Personal continues to develop its CAPEX plan to expand network and services such as the launch and expansion of 3G services.’ The operator now plans to expand network infrastructure in the south of Argentina to deal with the increasing volume in mobile traffic generated by new customers, Insussary said. ‘We are also increasing capacity in the greater Buenos Aires area and in the northern areas of the country,’ he added.