The fourth quarter profits of Latin America’s largest telecom company, América Móvil, have disappointed analysts. The telecom operator’s revenue for the fourth quarter of 2012 was down 1.1% year-over-year, and its net income was down 8.2%.
According to Reuters, América Móvil’s fourth quarter profits of $1.179 billion were far below analysts’ expectation of $1.901 billion (24.131 billion pesos). In Q411, the carrier posted profits totaling $1.2 billion.
Valeria Romo, a telecom analyst at Grupo Financiero Monex, told the Financial Times that the decreasing value of the U.S. dollar and in particular, the Brazilian real compared to the Mexican peso helped explain the company’s poorer than expected results.
The company, which is owned by Mexican billionaire Carlos Slim, posted positive numbers for the full year. América Móvil ended 2012 with $61.083 billion in total revenue, 6% more than $57.643 billion for 2011.
The 2012 fourth quarter earnings before interest, taxes, depreciation and amortization totaled $4.861 billion and for the full year, totaled $20.558 billion. The fourth quarter margin declined to 31.1% from 33.5% a year before.
América Móvil said that the margin reduction partly arises from the growth of PayTV and TracFone, which are lower margin businesses. It also reflects the continued smartphone migration, which entailed somewhat larger subsidies, as well as spillover effects on operating expenditures from the large investment program the company is currently conducting.
Operating profits reached $2.79 billion after depreciation and amortization charges, which remained in the range of 13% of revenue, similar to that of the prior year.
América Móvil closed 2012 with 325.7 million access lines, 8.7% more than in 2011. Of these, 261.6 million were wireless subscribers, 30.5 million landlines, 17.2 million broadband accesses and 16.4 million PayTV units. Brazil was highlighted as gaining 1.8 million new wireless subscribers, more than the 1.2 million in Mexico, 753,000 in the U.S. and 409,000 in Colombia.
At the end of the year, the carrier had a total of 70.4 million wireless subscribers in Mexico, 65.2 million in Brazil, 30.4 million in Colombia and 22.4 million in the U.S., as well as 20 million clients in Argentina and 21.1 million in Central America and the Caribbean.
América Móvil noted the continuing rise of mobile data revenue which has come to represent one third of its wireless revenue and 18% of total revenue.
