Minas Gerais state's largest mobile phone operator Telemig Celular recorded a second quarter 2006 net profit of 44.9mn reais (US$20.9mn), down 38% from 72.3mn reais in the same period last year, the Brazilian company said in its latest earnings statement.
Net revenues were 268mn reais, down 7% year-on-year, and Ebitda fell by 14% to 93.3mn reais in the second quarter of 2006. Telemig's Ebitda margin slipped to 38.4% from 40.9% a year ago.
Despite the decrease, Telemig posted the strongest margin in Brazil's mobile phone segment, which has some of the lowest margins worldwide, according to CEO Ricardo Sacramento.
Despite the arrival of a fourth market player, mobile phone company Claro backed by the financial muscle of Mexico's América Móvil, Telemig has not suffered, according to Sacramento.
Claro has a 3% share and Telemig is at the same level now as when Claro entered the Minas Gerais market in March, Sacramento told BNamericas. "It's business as usual for us," he added.
Telemig has held onto its leadership in terms of market share with 34.5% in Minas Gerais, despite a fall from 40.5% in the second quarter a year ago.
The company also recorded 3.40 million clients in the second quarter - 817,116 postpaid and 2.59 million prepaid - versus 2.97million a year ago.
Sacramento also warned that if Brazil's largest mobile operator Vivo tries to enter the Minas Gerais market, Telemig would fight it legally.
"It's unfair to change the rules in the middle of the game," Sacramento warned. All the operators signed their licenses based on having four operators and not five in the region, he said.
BNAmericas.com"
Posted to the site on 16th August 2006
Posted to: www.cellular-news.com/story/18864.php