Oct. 27 (Bloomberg) -- America Movil SAB, Latin America’s largest mobile-phone company, fell the most in four months in Mexican trading after losing prepaid subscribers in Mexico last quarter for the first time.

America Movil said yesterday that it lost 38,000 prepaid customers in Mexico. It signed 318,000 subscribers to long-term contracts, for a net gain of 280,000. That fell below the 919,000 estimate of Christopher King, an analyst at Stifel Nicolaus & Co. in Baltimore.

Mexico’s worst economic slump since the 1930s is hurting prepaid customers, which typically have lower incomes than contract subscribers. Handset prices increased in Mexico because of currency fluctuations, making it more expensive for the customers to sign up for service, Chief Executive Officer Daniel Hajj said today on a conference call.

“We are not forgetting prepaid,” Hajj said. “I’m sure when things get better in the economy, we’re going to start to have again growth on prepaid.”

America Movil, controlled by billionaire Carlos Slim, dropped 1.28 pesos, or 4.2 percent, to 29.41 pesos at 5 p.m. New York time in Mexico City trading. That was the biggest decline since June 22. The stock has climbed 39 percent this year.

Shifting to Contracts

America Movil said it’s shifting some higher-paying subscribers to contract plans. About 8.4 percent of its 58.4 million Mexican customers have long-term contracts.

The company may be willing to lose some market share because Mexico’s antitrust agency is investigating the wireless industry, King said. America Movil, based in Mexico City, is the nation’s biggest carrier.

“It might not be the worst thing from that point of view,” said King, who advises buying America Movil shares and doesn’t own any himself.

Third-quarter net income increased to 18.7 billion pesos ($1.4 billion), or 57 centavos a share, from 12.4 billion pesos, or 36 centavos, a year earlier, America Movil said yesterday in a statement. Sales climbed 17 percent to 99.8 billion pesos.

Even with the addition of contract subscribers, whose subsidized phones can put a dent in profits, America Movil’s operating profit margin widened in Mexico. The figure, excluding interest and taxes, was 48.9 percent, up from 46.5 percent a year ago.

International Customers

The company, which operates in 18 countries, added a total of 4 million customers, including 1.8 million in Brazil. That brings its international total to 194 million. It has 712,000 new customers in the U.S., where America Movil’s Tracfone unit is selling prepaid phone plans through Wal-Mart Stores Inc.

America Movil prefers to continue reselling wireless service from other carriers such as Verizon Wireless and AT&T Inc. rather than own a U.S. network itself, Hajj said today on the conference call.

Leaving out interest, taxes, depreciation and amortization, profit rose 16 percent to 40.4 billion pesos. The net income figure included a currency-related gain of 124 million pesos, compared with a loss a year earlier of 3.59 billion pesos.

The company may consider a special dividend this year as it weighs how to use its cash, Chief Financial Officer Carlos Garcia Moreno said today on the conference call. The company continues to expect capital expenditures this year of about $3 billion, and its investments next year should be in a similar range, Hajj said.

To contact the reporter on this story: Crayton Harrison in Mexico City at tharrison5@bloomberg.net

Last Updated: October 27, 2009 17:24 EDT