America Movil 1Q net profit rises as financing costs fall; obtains USD1 billion loan from China Development Bank

29 Apr 2009

Mexican telecoms giant America Movil has revealed its financial results for the three months ended 31 March 2009, posting an 18.7% rise in net income to MXN16.35 billion (USD1.15 billion). The company attributed the growth to a reduction in its financing costs coupled with an increase in operating profits; operating income totalled MXN26.9 billion for 1Q 2009, 13.2% more than a year before, as depreciation and amortisation charges declined from 14.3% to 13.6% of service revenues and earnings before interest, tax, depreciation and amortisation (EBITDA) rose 12.9%, to MXN38.3 billion. Revenue also improved against the same period a year earlier, rising 15.4% to MXN93.8 billion, on the back of continued subscriber growth and increases in data revenues and post-paid contract numbers.

The group added 3.9 million subscribers over the three-month period, bringing its total to 186.6 million. The company’s US-based subsidiary Tracfone, along with its operations in Ecuador, Chile, Paraguay, Nicaragua and the Caribbean, all recorded higher subscriber gains compared to the same period in 2008. Mexico led the way in terms of net additions with 1.2 million, followed by Brazil with 855,000.

The company also revealed that it had obtained a USD1 billion, ten-year loan from China Development Bank, the first by the lender to a Mexican corporate; the funds are expected to be used to finance the acquisition of network equipment.

Mexico, America Movil (AM)