Net Servicos’ Q4 revenue up, but profits down

11 Feb 2011

Brazilian triple-play cable TV operator Net Servicos reported net income of BRL133 million (USD80.1 million) in the fourth quarter of 2010, down from BRL137.9 million in the corresponding period a year earlier. The cableco attributed the fall to a rise in depreciation and amortisation costs which rose to BRL234 million in the period, from BRL177.7 million in 4Q09. Full-year net income for 2010 was BRL307.1 million, down sharply from BRL735.9 million in 2009. On a more positive note, Net Servicos said fourth-quarter net revenue rose 18% year-on-year to BRL1.45 billion and EBITDA of BRL446.2 million, up from BRL347.8 million a year earlier; EBITDA margin was 30.7% compared with 28.2% previously.

The strong fourth-quarter revenues were driven in part by sustained subscriber growth. By the end of December 2010 Net reported 4.212 million pay-TV subscribers, up 14% year-on-year, thanks to the addition of 147,000 net new users in the quarter. The broadband subscriber base rose by 195,000 net new users in Q4 to 3.524 million, up 22% y-o-y. Net also reported 3.153 fixed telephony customers, up 23% y-o-y. Net additions during the last quarter topped 172,000.