Telmex reported profits for US$ 3.25 billion in 2007, a 19.5% increase compared to the earnings of last year. Moreover, the company of Carlos Slim last year approved to divide the businesses of Mexico from those of Telmex Internacional, grouping operations in Argentina, Brazil, Chile, Colombia, Peru and Ecuador.
As consequence of the division, the company presented a detail of its 2007 results before the Mexican Stock Exchange. Despite the international projection, Mexico remains the main bastion of the company: Telmex Mexico reached profits for US$ 2.65 billion last year, a 4.3% increase in contrast to 2006. Billing of Mexican operations amounted to US$ 12.73 billion, a 0.8% increase in the year-to-year comparison.
Meanwhile, profits of subsidiaries grouped in Telmex Internacional amounted to US$ 605 million, a 238% growth compared to the value recorded in 2006. Telmex Internacional revenues reached US$ 6.24 billion during 2007, representing a 3.4% increase weighed against 2006 sales. The EBITDA stood at US$ 1.675 billion in 2007, a 48% drop matched up to the previous year.
Despite the weight of the operations in Mexico, the slowdown in growth in contrast to the performance of Latin American business will renew the company strategy to strengthen its actions in the broadband market. At the end of 2007, Telmex in Mexico reported 17.8 million fixed lines. The company, which has passed 19 million subscribers, continued in the fourth quarter with the policy of deactivating low-consumption lines, customers with debts and deactivated another 357 thousand lines. In contrast, out of 3.3 million Internet customers, 2.9 million belong to broadband services. Telmex’s ADSL continues as the main motor of broadband in the country, despite the explosion of cable operators offering Triple Play.
Moreover, an eventual increase in regulations applied to the company increases possibilities of a slow-down in Mexico. On the other hand, it is preparing to launch IPTV but has not yet obtained the authorization to give the service, which would come by mid-year. In this context, 2008 investments for more than US$ 2.4 billion will be mostly used for broadband services and to promote regional assets. In Mexico, the company is looking for a more profitable approach in a more conservative context.
In contrast, in the rest of Latin America, Telmex continues deploying WiMax and in the new business of cable operators, which enabled it to gain first place in Colombia and Peru. This gave it the possibility to advance in the satellite television market. Moreover, it has already begun to take its first steps together with América Móvil, the other company of Slim, to launch fixed-mobile services.