Convergencia Research, Consultoría especializada en Latinoamérica y Caribe
Thursday, August 20, 2020

Telecom lost 35,000 mobile clients in Argentina between April and June

Mobile service sales in Paraguay and Argentina totaled US$ 673 million in the first six months of the year.

The operator reached 18.8 million mobile service clients in the second quarter, of which 41% correspond to the postpaid category. The figure shows a drop of 35,000 accesses compared to the end of March.

In the fixed segment, the company's reading is that the amounts were relatively stable. It added 21,000 cable television subscribers compared to the first quarter and reached a total of 3.5 million. It also added 21,000 broadband clients, to end June with a total of 4.1 million. Among growth factors highlighted by Telecom, Flow Box reached 1.07 million accesses (includes Flow clients over FTTH and xDSL networks), compared to 1.01 million last March. Moreover, 55% of customers contract broadband speeds equal to or greater than 50 Mb, compared to 18% who did so in June 2019.

In the case of Núcleo Paraguay, the mobile customer base totals 2.2 million. 83% corresponds to the prepaid category and 17% to postpaid. Sales of services amounted to US$ 86 million in the first half of the year, a 7.6% increase year-on-year: 50% of this income comes from the Internet, whose sales increased 49% compared to the same period of 2019.

Loss. The company reported a US$ 11.1 million loss compared to the US$ 103 million registered in earnings in the same quarter last year. Revenues stood at US$ 885 million, a 1.5% decrease year-on-year, mainly explained by a contraction in handset sales (they generated US$ 42.5 million, a 29.4% drop).

Between April and June, from mobile sales revenues reached US$ 341 million, 11.1% more year-on-year. Internet services sales accumulated US$ 190 million with a fall of 5.1%; cable television services amounted to US$ 170 million, 7.9% less than in the same section last year; and the sale of fixed telephony and data services moved US$ 137 million, 2.2% less year-on-year.

To make the comparisons, the company took into account the impact of inflation. The numbers also express the result of the rate freeze due to the Covid-19 emergency.

In the same period, the company's operating costs fell 5.1% and the operating profit before depreciation and amortization was US$ 335, 8% more than in the same period last year (in the semi-annual account this indicator was US$ 651 million, 5.3% more year-on-year).

In the qualitative approach, Telecom associated the fall in net income to the impact of exchange differences "in a context of real devaluation, partially offset by the growth in Operating Income before D&A."

The balance adds that investments including additions for rights of use amounted to US$ 310 million between January and June of this year, 33.9% less than in the same section of the previous year.

Net Financial Debt reached US$ 1.784 billion in the first semester, 21.9% more in real terms compared to the same period in 2019.

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