Millicom's Q1 Driven by 77% CentAm Rev Growth

European mobile holding company Millicom International Cellular registered 77% revenue growth in Central America in the first quarter, the company said in a statement.

Overall, Millicom saw a 20% increase in first quarter revenues worldwide to US$322mn. Net profit was US$33.4mn compared to a US$11.3mn loss in the previous quarter, and total subscribers rose almost 1 million to 9.9 million.

Millicom's Central American revenues grew to US$157mn in 1Q06 from US$88.6mn in 1Q05 with Guatemala producing 92% growth.

In South America, revenues increased 43% to US$44.7mn, with Bolivia and Paraguay producing increases of 31% and 51% respectively compared to 1Q05.

The holding company's Latin American operators are Telecel Paraguay, Telecel Bolivia, Comcel in Guatemala, Celtel in Honduras and Telemovil in El Salvador.

Millicom's CEO Marc Beuls told a conference call that the rollout of the Tigo GSM brand in Latin America in 2005 had enabled the company to pursue higher value customers with value-added services.

Beuls highlighted the success of billing services and the e-pin "topup" service in Paraguay, which helped the company drive up ARPU to US$11 from US$8.

"Central America has continued to grow rapidly adding about 1.3 million subscribers within 12 months while growing revenues by 77%, which is impressive in what is Millicom's most mature region," he said.

"The economies in Central America are strong but the key driver of this growth has been the success of our Tigo brand ... evidenced in the results for South America which recorded 54% growth in subscribers and 43% growth in revenues."

Ebitda margins across the board were 44% while Ebitda margins in Central and South America were 50% and 42%, respectively. Beuls said he was confident the 50% Ebitda margin was sustainable and could increase in Central America.

The executive added that the company's capital expenditure in 2006 would be US$530mn, which will go toward boosting services in Pakistan and the Republic of Congo. Capex will remain high in 2007 before dropping off.

Millicom said in January it had launched a "strategic review" to contemplate selling its operations worldwide. Beuls would not comment on the process until it was complete, but reiterated that the process may not end in the selling of the assets.

BNamericas.com"

Posted to the site on 27th April 2006