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Mexico's Iusacell Reports Q3 Profits Up Only Slightly

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Mexico's Iusacell has announced today net revenue of Ps.2,696 million (USD201.8 million) and EBITDA of Ps.484 million (USD36.2 million) in the third quarter of 2008. In nominal terms considering each quarter figures in current pesos revenue grew 3%, and EBITDA increased 2% in the third quarter.

"For the 10th quarter in a row, we continued with our positive revenue and EBITDA trend, and were able to preserve our profitability margin this period", said Gustavo Guzman, Grupo Iusacell Chief Executive Officer. "On the strategic front, we focused on further increasing our postpaid subscriber base, which intensively uses our value added services, and represents higher revenue per user. The increase in postpaid clients translated into additional costs in the short term -- primarily due to handset subsidies -- but provides robust revenue in extended time periods."

Particularly significant was the dynamism of the BAM service -- wireless mobile connectivity through Internet broadband, at the fastest speed available in Mexico -- which reached 79,500 users, more than double compared to 34,500 a year ago.

Grupo Iusacell's subscriber base is 28% postpaid and 72% prepaid users. The ratio of postpaid subscribers to total users during the period is five percentage points higher than the 23% at the time of the Unefon merger -- during the second quarter of 2007 -- and the company is gearing its efforts toward continued strong percentage growth in the future. Prior to the Unefon merger, Grupo Iusacell's subscriber mix was 35% postpaid and 65% prepaid. Iusacell said that its objective is to eventually regain that same mix of subscribers.

Capital expenditures for the third quarter of 2008 were Ps.226 million (USD16.9 million), mainly for system and equipment purchases for the purpose of extending Iusacell's 3-G network coverage and capacity and its EVDO services.

As of September 30, 2008, the debt balance of the company was Ps.10,660 million (USD797.7 million), practically constant compared to the Ps.10,608 million reported a year ago.

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Tags: grupo iusacell  iusacell  Mexico