After Spain-based Telefónica released its financial results and canceled dividends, its biggest competitor in the Latin American market, América Móvil, (AMX) reported a 45.5% drop in second-quarter net income compared to 1Q211. América Móvil reported $1.001 million (13.252 million Mexican pesos) in the quarter.
América Móvil also had an increase of 9.3% in its second quarter total revenue, reaching $14.48 million (191.739 million Mexican pesos). Earnings before interest, taxes, depreciation and amortization increased (3.1%) to $ 4.945 million (65.465 million Mexican pesos) compared to the same period of last year.
For the first half of this year, América Móvil reported $29.025 million (384.237 million Mexican pesos) in total revenue, which is 10.8% higher than Jan.-June 2011. América Móvil’s net debt increased by $ 2.24 billion (29.7 billion Mexican pesos) in the first half, as a result of new investments in KPN and Telekom Austria.
América Móvil added 5.9 million wireless subscribers—including 1.1 million from the acquisition of Simple Mobile—and 1.7 million fixed-line, revenue generating units in the second quarter. At the end of June, the company had 251.8 million wireless subscribers, 30.0 million land lines, 16.1 million broadband accesses and 15.1 million pay-TV clients, for a total of 313.1 million accesses, 7.8% more than a year before.
The postpaid segment caught analysts’ attention. Net additions in Colombia and Mexico were 140,000 and 272,000 respectively, 34% and 23.9% higher than those registered the year before.
However, total ARPU in Brazil was down 11% year over year, while in Mexico it was up 6.7%. U.S.-based Macquarie Capital said it is not surprising that Brazilian mobile ARPU is collapsing, down 15.3% year-over-year. The firm pointed out that the intense competition between the four major operators in Brazil as well as cuts in mobile termination rates resulted in negative wireless revenue growth year-over-year in Q2.
Macquarie will keep América Móvil as its top pick for second half 2012 as ARPU growth should continue to accelerate from postpaid smartphone upgrades in the second half of the year and as MTR cuts graduate out.