America Movil's Profit Rises 8.8% After Takeover of Slim's Phone Company
Net income rose to 23.4 billion pesos ($1.87 billion), or 58 centavos a share, from 21.5 billion, or 56 centavos, a year earlier, Mexico City-based America Movil said yesterday in a statement. Sales rose 5.3 percent to 154 billion pesos, meeting the estimate of Christopher King, an analyst at Stifel Nicolaus & Co. in Baltimore.
America Movil, controlled by Mexican billionaire Slim, bought his Telmex Internacional SAB in a $23 billion transaction in June to add phone, Internet, and cable- and satellite-TV operations in Brazil, Colombia and other parts of the region. The company plans to combine Telmex’s regional fiber-optic networks with its own to offer faster mobile Internet speeds to customers.
America Movil closed the quarter with 217 million mobile- phone subscribers after adding 5.5 million, beating King’s 4 million estimate. The biggest additions came in Brazil, with 1.9 million new users, and Mexico, with 1.1 million.
“The economies down there have certainly strengthened a little more than we would’ve guessed,” aiding subscriber growth, King said yesterday in a phone interview. He advises holding the shares.
Mexico’s economy is “getting better,” and America Movil should be able to add more than 1 million subscribers there in the fourth quarter, Chief Executive Officer Daniel Hajj said today on a conference call.
America Movil will invest about $6 billion in mobile-phone, land-line and satellite network improvements next year, similar to this year’s figure, as it seeks to sign up more customers for Internet access and pay-TV service, Hajj said.
Sales of mobile-phone data services such as text messages and Internet access rose 27 percent last quarter to 18.4 billion pesos, or 22 percent of overall wireless revenue.
America Movil fell 4 centavos to 35.44 pesos at 4 p.m. New York time in Mexico City trading. The shares have gained 15 percent this year.
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