Telefonica Moviles Mexico Makes First Quarterly Operating Profit

MEXICO CITY -(Dow Jones)- Spanish telecommunications concern Telefonica SA (TEF) said Tuesday its Mexican mobile unit made its first-ever operating profit in the third quarter.

Telefonica Moviles Mexico had 578,000 net subscriber adds in the quarter, bringing its number of customers to more than 7.4 million. Telefonica Moviles attributed the expansion to improvements in its sales network and special calling-rate plans.

Sales were EUR244.8 million in the third quarter, and operating income before depreciation and amortization was EUR700,000, compared with an operating loss of EUR33.6 million on sales of EUR192.2 million in the year-ago period.

The positive operating result represents a milestone for Telefonica Moviles Mexico, which operates under the Movistar brand, competing with market leader Telcel. Telcel, the local unit of America Movil, added 1.6 million customers in the third quarter to 40.7 million.

Telefonica Moviles Mexico said average minutes of use rose 84.3% from the year-ago quarter to 87, while average revenue per user rose 16.2% to 123.40 pesos ($11.30).

-By Anthony Harrup, Dow Jones Newswires; (5255) 5080-3450, anthony.harrup@dowjones.com

(END) Dow Jones Newswires "

Posted to the site on 14th November 2006