By Natalia Siniawski MEXICO CITY (Reuters) -Mexican telecoms giant America Movil on Tuesday reported a more than threefold jump in third-quarter profit, in line with analysts’ expectations, helped by a sharp drop in financing costs and increased mobile revenues. America Movil, controlled by the family of Mexican billionaire Carlos Slim, cited a reduction of around […]
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America Movil posts threefold profit jump as costs shrink in Q3
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By Natalia Siniawski
MEXICO CITY (Reuters) -Mexican telecoms giant America Movil on Tuesday reported a more than threefold jump in third-quarter profit, in line with analysts’ expectations, helped by a sharp drop in financing costs and increased mobile revenues.
America Movil, controlled by the family of Mexican billionaire Carlos Slim, cited a reduction of around half its financing costs compared to the same quarter last year after it booked a foreign-exchange gain versus an exchange loss.
The group, which operates across Latin America, the Caribbean and parts of Europe, reported a net profit of 22.7 billion Mexican pesos ($1.24 billion) from revenues that rose 4.2% year-on-year to 232.92 billion Mexican pesos – in line with forecasts of analysts polled by LSEG.
The firm logged earnings per share of $0.40, also in line with analysts’ forecasts. Earnings before interest, taxes, depreciation and amortization (EBITDA) also performed broadly as expected, landing at 93.8 billion Mexican pesos.
Mexico’s peso strengthened 7% in the 12 months through the end of September, and just over 2% in the quarter.
America Movil added just over 3 million postpaid mobile clients and logged its strongest mobile service revenue growth in more than a year, up 7%. Its fixed segment added some 526,000 connections, largely in its home market of Mexico.
“We expect markets to receive the results well,” JPMorgan said in a note, citing gains in Mexico’s prepaid business and margin expansion in Chile, Paraguay and Uruguay.
The broker said the positive view was driven by strength in Mexican mobile, a key contributor to free cash flow.
America Movil has signaled expansion plans this quarter, including a potential acquisition of Telefonica’s Chilean assets in partnership with local telecom firm Entel, and possibly buying Brazilian internet provider Desktop.
($1 = 18.3147 Mexican pesos at end-September)
(Reporting by Natalia Siniawski; Editing by Sarah Morland and Lincoln Feast.)