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01/11 03:33
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call summary reflects strong financial performance with revenue and EBITDA growth, improved leverage, and significant shareholder returns. Despite challenges in subscriber growth and currency fluctuations, the company maintains a stable outlook and proactive strategies. The Q&A reveals competitive positioning in broadband markets and strategic partnerships, although some lack of clarity in satellite connectivity details. Given these factors, along with increased share buybacks and dividends, a positive stock price movement is anticipated, assuming the market cap is not large enough to dampen the reaction.
Revenue MXN223 billion, up 11.3% year-over-year, driven by service revenue growth and the depreciation of the Mexican peso.
Service Revenue Up 11.3% in Mexican peso terms; at constant exchange rates, service revenue was up 5.5% year-on-year, an improvement from 4.7% in the prior quarter.
EBITDA MXN47.4 billion, up 11.9% year-over-year; adjusted EBITDA increased 7.3% at constant exchange rates.
Operating Profit MXN47.4 billion, up 14.2% in Mexican peso terms and 10% at constant exchange rates.
Net Profit MXN6.4 billion, nearly tripling from the previous year, equivalent to MXN0.10 per share or $0.11 per ADR.
Comprehensive Financing Costs Decreased by 4.8% year-over-year to MXN28 billion.
Net Debt MXN433 billion, increased by MXN7.3 billion since December 2023, partly due to the depreciation of the Mexican peso.
Capital Expenditures Totaled MXN86.7 billion for the nine months to September.
Shareholder Distributions MXN32.9 billion, split almost evenly between share buybacks and dividend payments.
Net Debt to EBITDA Ratio 1.34 times last 12 months EBITDA, at the lower leverage limit committed to maintain.
New Broadband Package: Launched a new broadband package in Mexico that increased entry-level speed from 50 to 80 Mbps at the same tariff, including six months of Netflix free.
Mobile Backhaul via Satellite: Utilizing multiple partners for satellite connectivity, including Starlink and AST, to enhance mobile backhaul in rural areas.
Subscriber Growth: Added 1.8 million subscribers in Q3 2024, with 1.4 million being postpaid, indicating strong market positioning.
Fixed Broadband Growth: Connected 327,000 broadband accesses in Q3, with significant contributions from Mexico, Brazil, and Argentina.
Competitive Dynamics in Mexico: Increased competition in the fixed broadband market, with Telmex upgrading its network and bundling services.
B2B Market Growth: The B2B market related to cloud computing and cybersecurity is performing well.
Operational Efficiency: Improved customer service and installation times through IT upgrades.
CapEx Guidance: CapEx target for 2024 remains at approximately $7.2 billion.
ESG Rating Upgrade: Received third ESG rating upgrade by MSCI, reflecting improvements in corporate governance and data security.
Focus on Upselling: Strategy to focus on upselling customers rather than increasing prices.
Economic Factors: Concerns about the cooling US economy and its impact on the labor market have led to fluctuations in interest rates, which could affect consumer spending and, consequently, the company's revenue.
Competitive Pressures: In Mexico, the fixed broadband market is becoming increasingly competitive, with Telmex upgrading its network and bundling services to attract customers. This has resulted in higher churn rates and lower net additions in broadband.
Regulatory Issues: The company is navigating a complex regulatory environment in various Latin American countries, which can impact operational flexibility and market strategies.
Supply Chain Challenges: The depreciation of the Mexican peso against other currencies has affected the company's financial obligations and could impact future capital expenditures.
Debt Management: The company has seen an increase in net debt, partly due to currency depreciation, which poses a risk to financial stability and future investment capabilities.
Market Dynamics: The prepaid segment is sensitive to economic conditions, with consumer purchasing power affecting recharge rates. This could lead to volatility in revenue from this segment.
Technological Competition: The company faces challenges in maintaining its competitive edge in technology, particularly in the 5G space, as competitors also invest heavily in network upgrades.
Subscriber Growth: In the third quarter, America Movil added 1.8 million subscribers, with 1.4 million being postpaid. Key contributions came from Austria (430,000), Brazil (291,000), Colombia (59,000), and Mexico (108,000).
CapEx Guidance: The company is on target for capital expenditures of around $7.2 billion for the year.
5G Network Expansion: America Movil is focusing on expanding its 5G network across Latin America, with significant investments in upgrading customer services and infrastructure.
ESG Rating Improvement: The company received its third ESG rating upgrade by MSCI in three years, reflecting improvements in corporate governance and data security.
Revenue Growth Outlook: Mobile service revenue growth is expected to continue, with a focus on upselling postpaid customers and enhancing service offerings.
Debt Strategy: The company plans to maintain its leverage ratio and is not looking to take on additional debt, focusing instead on refinancing existing obligations.
Free Cash Flow: America Movil is projected to generate over $5 billion in free cash flow next year, with potential plans to return a significant portion to investors.
Market Positioning: The company aims to consolidate its position in competitive markets like Chile and continue to grow its broadband and mobile services across Latin America.
Shareholder Distributions: MXN32.9 billion, split evenly between share buybacks and dividend payments.
Share Buybacks: Approximately MXN14 billion in share buybacks from January to the third quarter.
Dividends: Dividends are included in the MXN32.9 billion shareholder distributions.
Net Debt: MXN433 billion, increased by MXN7.3 billion relative to December 2023.
Net Debt to EBITDA Ratio: 1.34 times last 12 months EBITDA.
Capital Expenditures: Totaled MXN86.7 billion in the nine months to September.
The earnings call summary shows strong financial performance, with revenue, EBITDA, and net income growth. Mobile platform service revenue is up, and net debt is reduced. The Q&A reveals positive sentiment about mobile prepaid revenues and margin expansion in key regions. Potential acquisitions are in early stages but could offer strategic benefits. The competitive environment is manageable, with the company leveraging its strengths. While some uncertainties exist, the overall sentiment is positive, suggesting a potential stock price increase of 2% to 8% over the next two weeks.
The earnings call summary shows strong financial performance, with subscriber and revenue growth, and increased EBITDA. The Q&A section reveals positive drivers in Brazil and Mexico, regulatory changes viewed positively, and a strong network and commercial strategy. Despite some unclear responses, the overall sentiment is positive, driven by strong financial metrics and optimistic guidance. The company's strategic focus on network quality and customer care supports a positive outlook, likely resulting in a stock price increase of 2% to 8% over the next two weeks.
The earnings call shows mixed signals. Positive revenue growth and share buybacks are offset by economic slowdown, prepaid losses, and regulatory uncertainty. The Q&A reveals management's optimism about recovery and strategic focus but lacks clarity on some issues. Despite strong financials, concerns over regulatory changes and economic conditions in Mexico temper expectations. Given these factors, the stock price is likely to remain stable in the short term, leading to a neutral rating.
The earnings call summary reflects strong financial performance with revenue and EBITDA growth, improved leverage, and significant shareholder returns. Despite challenges in subscriber growth and currency fluctuations, the company maintains a stable outlook and proactive strategies. The Q&A reveals competitive positioning in broadband markets and strategic partnerships, although some lack of clarity in satellite connectivity details. Given these factors, along with increased share buybacks and dividends, a positive stock price movement is anticipated, assuming the market cap is not large enough to dampen the reaction.
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