Vivo’s Q4 net income down on tax charges

11 Feb 2010

Vivo Participacoes, Brazil’s largest mobile operator by subscribers, yesterday published its fourth-quarter financial results, showing net income dipped marginally year-on-year due to a near tripling in tax payments and after customers spent less on its products and services. Q409 net income was BRL221.6 million (USD120 million), down from BRL222.1 million in the year earlier period, and below the profit of BRL340 million recorded in the third quarter. Blended monthly average revenue per user (ARPU), slumped 10.3% year-on-year to BRL26.1, and was down 1.1 percentage points from the prior quarter. Vivo said its net revenues and costs climbed 1.2% y-o-y, helping operating margins, but tax payments rocketed to BRL220 million, from BRL71 million in 4Q08.

Vivo’s net revenue rose 3.4% y-o-y to BRL16.36 billion from BRL15.82 billion in the year-ago period as increased sales of data and value added products countered a decline in revenue from handset sales. The cellco’s subscriber base reached 51.74 million as at 31 December, up 15% on the previous year. Fourth-quarter earnings before interest, taxes, depreciation and amortisation (EBITDA) was BRL5.2 billion, up from BRL4.8 billion in 2008. EBITDA margin, a measure of profitability over net revenues, nudged up to 31.9% in 2009, from 30.8% a year earlier.