America Movil’s net profit rebounds in first quarter on lower financing costs

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The logo of America Movill is seen on the wall at the company's corporate offices in Mexico City

MEXICO CITY (Reuters) – Mexican telecommunications giant America Movil on Tuesday said its net profit rebounded in the first quarter, driven mainly by lower financing costs, following a loss in the same period a year earlier.

The company’s net profit rose to 1.81 billion pesos ($88.7 million) in the first quarter, compared with a loss of 28.9 billion pesos for the same period a year earlier, according to a statement filed with the Mexican stock exchange.

Operating income was 41.1 billion pesos, an increase of 5.7%, while comprehensive financing costs fell 55%, which the company said resulted in “a swing in net profits.”

The company, which is controlled by the family of Mexican billionaire Carlos Slim, reported revenue of 248.19 billion pesos, down about 0.8% year-on-year.

Earnings before interest, tax, depreciation and amortization (EBITDA) grew 5.2% in peso terms during the January to March period.

America Movil’s base mobile subscribers grew by 6 million, a third more than the previous year, led by Brazil, Mexico and Colombia.

The company added 246,000 broadband clients, mainly in Colombia, Ecuador and Peru.

“We ended March with 374 million access lines, 2.8% more than a year before with our postpaid base and our fixed-broadband accesses increasing 7.8% and 4.7%, respectively,” the company said.

In its core market of Mexico, revenues totaled 71.5 billion pesos. Service revenues were flat year-on-year, while mobile revenues dipped 0.2% and fixed-line platform revenues remained almost unchanged.

“The recovery in fixed-line revenues was driven by fixed-broadband and corporate networks that expanded 2.5% and 1.6%, respectively, compensating the decline in voice revenues,” the company said.

“Equipment revenues were down 11.7% on lower handset sales, partly stemming from the global shortage of chips,” it added.

($1= 20.4200 pesos at end-March)

(Reporting by Cassandra Garrison and Noe Torres; editing by Richard Pullin and Jane Wardell)

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