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01/11 03:34
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
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.
Revenue MXN232 billion, up 14.1% year-on-year; growth driven by service revenue expansion of 15.8% and adjusted EBITDA increase of 13.3%.
Service Revenue Increased by 15.8% year-on-year; growth attributed to the appreciation of most currencies against the Mexican peso, particularly the Colombian and Chilean pesos.
Adjusted EBITDA MXN44.8 billion, up 13.3% year-on-year; increase partly due to currency appreciation and adjustments for the sale of towers by Telmex a year prior.
Operating Profit MXN44.8 billion, a 10% year-on-year increase; increase attributed to operational efficiencies despite higher depreciation and amortization charges.
Net Income MXN18.7 billion, up 38% year-on-year; significant growth attributed to decreased comprehensive financing costs.
Net Debt MXN500 billion, equivalent to 1.5x last 12 months EBITDA; increased by MXN11 billion in the quarter to fund capital expenditures and other obligations.
Capital Expenditures MXN25 billion; funded by the increase in net debt.
Share Buybacks MXN4 billion; part of the financial strategy to return value to shareholders.
Labor Obligations MXN7 billion; part of the financial commitments during the quarter.
Postpaid Subscribers Added: In the first quarter, we added 2.4 million postpaid subscribers, with Brazil leading the way with 987,000 clients, followed by Colombia with 163,000 and Mexico with 133,000.
Broadband Access: In the fixed line segment, we connected 446,000 new broadband accesses, with Mexico contributing 165,000 clients, Brazil with 98,000, and Central America with 52,000.
Revenue Growth: Our first quarter revenue was up 14.1% year-on-year in Mexican peso terms to MXN232 billion, with service revenue expanding 15.8%.
Net Income: Our net income was up 38% to MXN18.7 billion, equivalent to MXN0.31 per share, $30 per ADA.
EBITDA Growth: Adjusted EBITDA increased 13.3%, reflecting the year-over-year appreciation of most currencies versus the Mexican peso.
Operating Profit: Our first quarter operating profit totaled MXN44.8 billion, a 10% year-on-year increase.
Market Positioning: The Central America and Eastern European blocks were top performers in the period, exhibiting faster service revenue growth in both the fixed and wireless platforms.
Economic Slowdown in Mexico: The Mexican economy has been slowing down since April of last year, with private consumption declining 1% year-on-year due to uncertainty around elections and tightening public expenditures.
Currency Fluctuations: The Mexican peso remained almost flat against the U.S. dollar, while other currencies appreciated, leading to potential revenue impacts.
Prepaid Subscriber Losses: The company experienced 1 million net prepaid losses, particularly in Mexico and Brazil, indicating challenges in retaining prepaid customers.
Regulatory Uncertainty: There is uncertainty regarding potential new tariffs by the U.S., which could impact operations and financial performance.
Interest Rate Increases: Increasing real interest rates in Mexico may affect consumer spending and borrowing, further impacting economic activity.
Supply Chain Challenges: The tightening of public expenditures may lead to supply chain challenges, affecting operational efficiency and service delivery.
Subscriber Growth: In the first quarter, we added 2.4 million postpaid subscribers, with Brazil leading the way with 987,000 clients.
Broadband Expansion: Connected 446,000 new broadband accesses, with Mexico contributing 165,000 clients.
Service Revenue Growth: Service revenue increased 15.8% year-on-year in Mexican peso terms.
EBITDA Growth: Adjusted EBITDA increased by 13.3% year-on-year.
Revenue Growth Outlook: At constant exchange rates, service revenue is expected to increase by 6.1%.
EBITDA Margin Outlook: Most operations saw EBITDA margins increase sequentially.
Capital Expenditures: Capital expenditures for the quarter amounted to MXN25 billion.
Net Debt: Net debt at the end of March stood at MXN500 billion, equivalent to 1.5x last 12 months EBITDA.
Share Buybacks: Share buybacks of MXN4 billion were executed during the quarter.
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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