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America Movil's 2Q Profit Doubles on Exchange Gains

By Anthony Harrup

 

MEXICO CITY--Telecommunications company America Movil SAB more than doubled its profit in the second quarter from a year earlier as a result of higher operating income and foreign exchange gains.

The company controlled by billionaire Carlos Slim had a profit of 42.8 billion Mexican pesos ($2.1 billion) for the April-June period, compared with 19.5 billion pesos in the second quarter of 2020. Profit was equivalent to 0.65 pesos a share, or 64 U.S. cents an American depositary receipt.

The appreciation of the Mexican peso against all other currencies in which the company operates, including the U.S. dollar, the euro and the Brazilian real, contributed to a 21.1 billion-peso exchange gain, boosting the net result.

But the stronger currency also limited revenue growth in Mexican peso terms, which increased 0.4% from the year-earlier quarter to 252.5 billion, with a 34% rise in equipment sales partly offset by a 4.6% decline in service revenue.

In constant currency terms, revenue from services rose 5.6%. The company said comparisons were made easier because the second quarter of 2020 saw the greatest impact of the coronavirus pandemic on its activity.

Earnings before interest, taxes, depreciation and amortization -- a measure of profitability -- increased 2.8% to 84.9 billion pesos, and operating profit rose 9.3% to 44.7 billion pesos.

America Movil, Latin America's largest telecommunications company by revenue, added 4.2 million wireless subscribers in the quarter, bringing its total to 297.7 million. Brazil saw the most additions with 1.4 million, followed by Argentina with 870,000. Mexico and Colombia each added around 430,000 subscribers.

Subscriptions to fixed-line services -- phone, pay TV and internet -- slipped by 132,000 in the quarter to 80.5 million, despite 128,000 broadband additions.

 

Write to Anthony Harrup at anthony.harrup@wsj.com

 

(END) Dow Jones Newswires

July 13, 2021 17:39 ET (21:39 GMT)

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