América Móvil Reports 68% Surge in Q4 Net Profits Amid Currency Fluctuations
Mexico City, in an impressive financial showcase, América Móvil, Latin America's largest telecommunications company by subscriber count, has reported a significant 68% rise in net profits for the fourth quarter. This financial uplift positions the company at a net profit standing of 26.42 billion Mexican pesos ($1.54 billion), marking a robust end to the fiscal year.
Despite the headwinds of currency fluctuations, particularly the strengthening of the Mexican peso against other currencies, América Móvil navigated through, presenting a nuanced financial landscape. The company saw a slight revenue decline of 2.5% to 204.42 billion pesos. This revenue impact was attributed to the peso's appreciation, which tempered the peso value of international sales.
On a brighter note, service revenue in constant currency terms experienced a 3.7% increase, led by mobile services, highlighting the company's resilient operational performance. The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA), although down by 3.3% to 79.68 billion pesos, mirrors the challenges posed by currency valuation shifts.
The operational front saw a decline in operating profit by 6.2%, standing at 42.3 billion pesos. Yet, América Móvil's strategic moves continued to pay off in terms of subscriber acquisition. The telecom giant added 3.9 million mobile subscribers during the quarter, escalating its total to 310.1 million by the year's end. The fixed-line services segment also saw growth, adding 253,000 subscriptions, reaching 73.7 million, thanks to a net increase in broadband connections that somewhat cushioned the losses in fixed phone and pay TV subscriptions.
This fiscal quarter's results from América Móvil underline the broader narrative of technological growth and strategic adaptation in the face of currency headwinds. With these financial metrics, América Móvil not only cements its fiscal health but also showcases its agility in responding to both operational challenges and opportunities in the highly competitive telecommunications landscape.
In essence, América Móvil's Q4 financial performance is a testament to its operational strength and strategic foresight, setting a confident tone for its journey in the dynamic telecommunications sector.
Analyst comment
Positive
As an analyst, I predict that the market will respond positively to América Móvil’s Q4 financial performance. The significant rise in net profits despite currency fluctuations showcases the company’s resilience and adaptability. The increase in service revenue and subscriber acquisition further highlight its operational strength. With its confident fiscal health, América Móvil is well-poised to navigate the competitive telecommunications landscape.
