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Higher debt pushes down America Movil’s Q4 NP
Monday, 13 February 2012 02:24

Mexican telecoms major America Movil SAB posted Thursday a 36% net profit decline Y-o-Y in its fourth quarter of 2011 as a weaker peso and higher net debt to finance stock purchases offset gains in revenue and operating income. Net profit for the quarter ending December 31 was 16.3 billion pesos ($1.17 billion) compared with MXN25.5 billion in the year-ago period. Revenue increased 12.3% to MXN182 billion, facilitated by a 15.4% rise in wireless revenues. Fixed-line revenue climbed 6.8%. EBITDA increased 3.9% to MXN64.5 billion. The telco added only 304,000 net wireless customers in the quarter, bringing its total to just under 242 million. The surprisingly small rise in wireless subscribers from predictions of adding around 6.3 million occurred as the company disconnected almost 4.9 million inactive prepaid subscribers in Mexico, Colombia and Ecuador under a new methodology. Brazil saw 2.9 million net subscriber additions. The company’s net debt of MXN321 billion at December end from MXN207 billion a year ago was weighed upon by the depreciation of the Mexican peso and an increase in debt to finance share buybacks and stock purchases in several units including Mexican fixed-line unit Telmex, thereby increasing financial costs.

 

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