Convergencia Research, Consultoría especializada en Latinoamérica y Caribe
Thursday, October 24, 2019

Millicom revenues increased due to acquisitions in Panama and Nicaragua

The increase corresponds to the third quarter, after the incorporation of Telefónica's operations in these Central American countries. If the first nine months of 2019 are considered, the increase is 7.4% year-on-year. However, the acquisitions also affected operating profit, which fell 15% for both the quarter and the accumulated year, and net profit, to the point that the company reported a loss of US$130 million between July and September.

Millicom presented its financial results for the period July-September 2019, which show the impact of acquisitions in Central America. Revenues stood at US $1.097 billion, while the operating profit was US$178 million, affected not only by these integrations but also by the economic situation in some markets (Nicaragua, Paraguay, Bolivia and Panama). The 15% decrease in this last component caused the company to report losses of US$130 million in the period.

If we look at Millicom's results in Latin America in particular - including joint ventures in Guatemala and Honduras, unlike total reports - there was a 9.7% increase in revenues, to US$1.5 billion; from 9% in revenues from services, to US$1.383 billion; and from 18.2% in Ebitda, to US$620 million. These increases respond to purchases of Telefónica operations, which contributed to a record addition of 99,000 HFC customers (totaling 3.4 million), and 858,000 4G mobile data subscribers (total 13.5 million, 35% from the mobile lines base).

As for the access park, the mobile base expanded by 17.3% to 38.38 million, thanks to the incorporation of Nicaragua in the second quarter and Panama in the third. The mobile ARPU was reduced by 11.5% due to the weakness of certain currencies against the dollar (Colombia, Bolivia, Paraguay) and the purchase of Movistar Nicaragua, whose ARPU is lower than the Latin American average.

In the fixed segment, the total of passed homes is 11.63 million (+17.4%). The RGUs rose 34.2% to 6.77 million and the ARPU 1.2% to US$ 29.2.

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