The Brazilian telecom Grupo Oi reported a second-quarter drop in its net income of U.S.$31.23 million (R$64 million) in 2Q12, which is much less than the U.S.$169.2 million (R$346 million) of 1Q12 and the U.S.$69 million (R$141 million) of 4Q11. Oi reported U.S.$3.379 million (R$6.909 million) in revenue, which is a little more than the 1Q12 reported revenue of U.S.$ 3.326 million (R$6.802 million) and lower than the 4Q11 report of U.S.$ 3.403 million (R$ 6,958 million).
Oi pointed out that in April 2012, it disclosed its long-term strategic plan, including its plans for 2012-2015. The 2012 second quarter results reinforce Oi’s executives’ confidence that the company “is on the right path to achieve the goals of its strategic plan.”
On July 23, Oi’s suspension by the Brazilian Agency of Telecommunications, Anatel took effect, preventing the sale of new mobile line services in the states of Amazonas, Amapá, Mato Grosso do Sul, Roraima and Rio Grande do Sul. Oi believes that Anatel based its decision on parameters that do not reflect the concentration of investments the company made in the past 12 months, which have already resulted in improved services. Nevertheless, Oi noted that it is working on a plan to be submitted to Anatel so that it can start offering its services again in the affected states as soon as possible.
Oi said it does not expect significant impacts from the suspension on its financial results. The carrier will continue to sell recharge services and provide mobile telephony to its entire pre-paid and post-paid client base, as well as fixed telephony, broadband and paid-TV services.
>>> Check out the full financial results here.
(The currency exchange rate at time of report: $1 USD = 2.04483 BRL)