Brazilian carrier Oi posted positive results for its third quarter period. The company reported that its revenues have grown as well as its earnings before interest, taxes, depreciation and amortization, EBITDA margin and net earnings compared to the previous quarter. However, over the same period its net debt increased and its available cash decreased.
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Oi CEO Francisco Valim stated that in the third quarter of 2012, the company succeeded in posting year-over-year and sequential growth in revenue generating units across all of its business segments, driven by the positive response of residential clients to the company’s triple-play and quadruple-play offers, and the significant increase in the postpaid personal mobility base as well as substantial gains in wireline, broadband and mobile services for business and corporate markets.
The consistent RGU growth that Oi presented throughout the year resulted in a 1.9% sequential increase in revenue.
Among the third quarter highlights, Oi reported that its residential segment showed year-on-year growth as the accelerated convergence of services more than offset the industry attrition trends in wireline; similar factors drove a sequential increase. Regarding personal mobility, Oi noted that it maintained a strong postpaid growth combined with greater prepaid profitability. The sequential growth in the business/corporate vertical resulted from new product launches and expanded mobile penetration.
In the upcoming months, Valim expects the positive trends of the third quarter to continue with full year 2012 net revenues from services evolving in line with the Oi’s strategic plan. He added that these results have mitigated Oi’s need to use subsidies for handsets, and therefore, revenue from handsets was below expectations. As a result, Oi lowered its budgeted annual revenue from handsets, which was approximately $725 million, by $290 million and $387 million.
As for wireless, Oi’s net revenue from the unit the company calls personal mobility totaled R$2.3 billion, up 3.4% compared to the prior quarter and up 10.7% compared to the third quarter of 2011. Revenue from services totaled $755 million, up 1.9% sequentially and 7.4% compared to last year.
Oi attributed the growth to the higher revenue from subscriptions due to the increase in the postpaid customer base; higher traffic revenue due to the increase in the prepaid customer base; and higher revenue from 3G services, reflecting the increase in the total number of customers.
Net revenue from network services was $294 million during the third quarter, up 8.4% sequentially but down 1.5% year-on-year.
The exchange currency rate at the time of this report was R$1 to U.S.$0.48
