TIM Brasil reports 29.5% rise in Q1 profit

30 Apr 2012

Telecom Italia’s Brazilian telecoms unit TIM Participacoes (TIM Brasil) has reported a 29.5% year-on-year rise in net profit for the three months ended 31 March 2012 to BRL276.4 million (USD146.3 million) driven by solid subscriber growth and rising revenue. TIM Brasil, the nation’s second largest carrier by subscribers, increased its mobile base by 27.2% y-o-y to 67.2 million, as gross additions topped 9.9 million lines and net additions reached 3.1 million. The carrier booked top line revenue of BRL4.50 billion (+19.1% y-o-y), while net service revenues grew 15.9% y-o-y and (gross) data revenue surged 56.1% to BRL1 billion as smartphone penetration reached 31.1% of the total base, compared to 12.6% a year earlier. The operator also said that outgoing voice revenues continued to be resilient, growing at a rate of 14.6% on an annualised basis in 1Q12. Earnings before interest, taxes, depreciation and amortisation (EBITDA), a measure of operating profit, increased by 13.2% year-on-year to almost BRL1.13 billion, broadly in line with a forecast of BRL1.15 billion. EBITDA margin stood at 26.2%, compared with 27.5% for the year-earlier period, reflecting rising costs as TIM Brasil jostles for space in a hotly contested domestic mobile segment where rivals are accelerating ad campaigns to sign up new users.

TIM Brasil invested a total of BRL543 million in its networks and services in the January-March period, up 83% versus 1Q11, in the process expanding its 3G coverage to 68 new cities, with 1,030 antennas connected to fibre.

Brazil, TIM Brasil