America Movil S.A.B. de C.V. (AMX) reported fourth-quarter 2014 earnings per ADR (American Depository Receipt) of 8 cents, largely missing the Zacks Consensus Estimate of 54 cents. The figure also showed a 78.4% decline from 35 cents earned in the year-ago quarter. Meanwhile, total revenue of $16,533 million in the fourth quarter improved 2.7% year over year and exceeded the Zacks Consensus Estimate of $15,309 million. Following the results, the company’s shares dropped nearly 5% yesterday.
Segment wise, Services revenues were around $14,236 million, up 0.9% year over year. Equipment revenues totaled $2,297 million, up 14.7% year over year on growing demand for smartphones and tablets.
Total costs and expenses in the reported quarter increased 4.1% year over year to stand at $11,654 million. Quarterly EBITDA declined 0.7% year over year to $4,879 million. EBITDA margin stood at 29.5% compared with 30.5% in the year-ago quarter.
Subscriber Statistics
America Movil's total subscriber base reached 367.8 million at the end of Dec 31, 2014, up 8.4% year over year. This figure includes 289.4 million wireless subscribers, 34.3 million landlines subscribers, 22.6 million broadband accesses and 21.5 million pay-TV units.
Results by Prime Regional Segments
Quarterly revenues from Mexico, America Movil's home ground improved 1.8% year over year to $5,252.5 million. On the other hand, EBITDA grew 4.4% to $2,237.14 million. Mexican ARPU (average revenue per user) decreased 3.3% year over year to $11.5 while the churn rate stood at 4.3%, flat with fourth-quarter 2013 figure.
Revenues from Brazilian operations climbed 5.6% year over year to $3,645.3 million. EBITDA also increased 6.5% to $908.5 million. Meanwhile, Brazilian ARPU declined 4.4% year over year to $5.9 while churn rate deteriorated 40 basis points (bps) year over year to 3.2%.
America Movil's U.S. operations (Tracfone) witnessed 13.8% year-over-year growth in revenues, reaching the number to $1,756 million. However, EBITDA decreased 39.6% to $72 million. On a year-over-year basis, ARPU increased 0.8% to $20, while churn rate rose by 60 bps to 4.2%.
Liquidity
At the end of 2014, America Movil had around $5,237.2 million of cash and marketable securities compared with $3,845 million at the end of 2013. Total debt, at the end of 2014, was around $41,247 million against $43,679 million at the end of 2013.
America Movil currently has a Zacks Rank #3 (Hold).
Stocks to Consider
Better-ranked stocks in this sector include China Unicom (Hong Kong) Limited (CHU), NTT DOCOMO, Inc. (DCM) and China Mobile Limited (CHL). China Unicom sports a Zacks Rank #1 (Strong Buy) while NTT DOCOMO and China Mobile Limited hold a Zacks Rank #2 (Buy).
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