Millicom International Cellular (MIC), which offers mobile and cable broadband services in Latin America via the Tigo brand, has reported quarterly revenue of USD1.1 billion for the three months ended 31 March 2020, up 5.1% year-on-year from USD1.0 billion. Operating profit, meanwhile, slumped 17.1% from USD161 million in Q1 2019 to USD134 million in the period under review. Finally, Millicom recorded a net loss of USD122 million for first quarter, compared to a net profit of USD13 million in the year-ago period.
In operational terms, MIC reported that its Latin American mobile user base climbed 16.4% on an annualised basis, to reach 39.449 million at 31 March 2020. However, the group did suffer net subscriber losses of 397,000 in Q1, noting: ‘COVID-19 severely disrupted our distribution channels and impacted our ability to capture new customers during the quarter.’ LatAm 4G customers surged 38.3%, to 14.876 million by end-March, while the number of HFC customer relationships jumped 10.3% to 3.531 million. The group’s African unit – which now consists solely of its operations in Tanzania (including Zantel) – accounted for 11.727 million subscribers as of 1Q20.
With reference to the ongoing COVID-19 pandemic, Millicom has implemented four initiatives aimed at preserving strong cash flow and liquidity in 2020:
1. Cost savings of at least USD100 million, reflecting lower levels of activity as well as new measures;
2. CAPEX reduction of USD200-USD300 million, as it focuses resources on adding capacity and preserving network integrity;
3. Cancellation of the dividend for 2020 (USD100 million); and
4. Suspension of the 2020 share buyback programme (approximately USD150 million).