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América Móvil and Globe release full year earnings

Financial results NEW .jpg

Revenue and profit increased across the board for both América Móvil and Globe as the former reaped the rewards of its Tracfone sale and the latter reported its network investments had paid off.

América Móvil: Eastern Europe and Peru lead the way

América Móvil saw gains across the business over the full year and most recent quarter, but there were two markets that stood out.

Eastern Europe and Peru observed the fastest revenue growth in fixed-line services, at 13.1% and 11.8%, respectively, followed by Colombia and the Dominican Republic (7.1% and 6.2% respectively).

Eastern Europe and Peru also got a special mention for mobile service revenue growth. Alongside Puerto Rico, the Dominican Republic, Mexico and Brazil, growth varied from 8% to 12.4%, while Austria posted a 7% increase. On total revenue, Peru saw a 13.1% increase in Q4 2021 when compared to the same quarter in 2020 (see table).

Over the reported period, América Móvil closed on its sale of Tracfone to Verizon, for which it received $3.6 billion in cash and 57,596,544 shares at US$51.54 each. Part of the proceeds from this transaction were channelled into paying down bonds which had maturities due this calendar year – they also provided a significant boost to the consolidated results – fourth quarter net profit more than tripled compared to Q4 2020.

Including Tracfone proceeds net profit for the quarter totalled $6.6 billion (135.6 billion pesos). Net profit for the full year was US$9.54 billion (196 billion Mexican pesos) and $3.44 billion (70.7 billion pesos) when considering only continued operations, a rise of 136.8% on the year prior.

Consolidated service revenue increased 4.4% year on year at constant exchange rates taking Q4 total revenue to $11.065 billion (227.3 billion Mexican pesos), a 7.7% year-on-year increase in nominal peso terms, with service revenue increasing 5.4% year on year (4.4% at constant exchange rates).

In mobile and fixed service revenue the growth stood at 6.9% and 0.5% YoY at constant exchange rates. Prepaid wireless revenue growth stood at 8.7% and that of corporate networks at 6.8%. Adjusted EBITDA increased +7.7%YoY at constant exchange rates EBITDA came in at $4,37 billion (89.8 billion pesos), 16.6% more than a year before in nominal peso terms.

Finally, in addition to Tracfone, correcting for the Telmex tower sale and an extraordinary positive impact a year before associated with the release of certain collection reserves, adjusted EBITDA totalled 82.9 billion Mexican pesos, up 8.9% relative to Q4 21. At constant exchange rates, adjusted EBITDA was up 7.7% year-on-year.

Customer highlights included 4.8 million wireless net adds and 72,000 new broadband clients.

América Móvil total revenues by market, Q4 21 compared to Q4 20

 

Market

Q4 21 vs Q4 2020

Mexico

Total revenue up 11%

Brazil

Total revenue up 0.9%

Colombia

Total revenue up 7.9%

Peru

Total revenue up 13.1%

Ecuador

Total revenue down 1.1%

Chile

Total revenue up 2.7%

Argentina

Total revenue down 1.9%

Central America

Total revenue up 6.3%

Caribbean

Total revenue up 5.8%

 Austria

Total revenue stable at 682 million Euros for both periods

Other Europe

Total revenue up 11%

 

Globe: Investing for the future

Over in the Philippines, Globe Telecom confirmed record capex for the full year, reaching $1.81 billion (P92.8 billion) and committing a further $1.73 billion (P89 billion).

The massive spend supported Globe's "aggressive network expansion", which included 1,407 new cell sites nationwide including both 4G LTE and 5G; the upgrade of more than 22,300 mobile sites; and the installation of more than2,000 5G outdoor sites and in building solutions (IBS)as of end-December of 2021. On FTTH Globe installed more than 1.4 million lines, surpassing its revised target for the year.

The group highlighted how this improved network services for both fixed line and mobile across the country's challenging geography. Backing the claims data provided by Ookla showed a 51% improvement on download speeds between Q1 and Q4 and 24% on upload speeds.

Globe commented: "The Philippines logged better internet speeds in December, improving in both mobile and fixed broadband rankings as it sustained a steady climb.  The country rose nine places to 63 out of 178 in median fixed broadband connectivity. Mobile connectivity also improved … This pushed the Philippines up a notch to 89 out of 138 countries."

The cost of data – referenced frequently this reporting season – also got a mention. On this, Globe said around 86% of Capex went to data-related requirements "to serve the rising demands of Filipino consumers who access the internet to carry on with their daily activities, maintain business operations and deliver critical services".

The total capex spend for the full year represented 61% of gross service revenues and 124% of EBITDA.  However, it paid off. The group closed the year with another record – this time for consolidated net income which stood at $462 million (P23.7billion) a year-on-year increase of 27%. This  was  mainly  attributed  to  the 2% increase in EBITDA, and  a  57%  decline  in  non-operating  charges  which  fully  offset  the  16%  increase  in depreciation expenses. 

Compared to the prior quarter, consolidated net income improved by 17%.

 

 

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