CANTO Weekly Newsletter – BNamericas: 05/10/14

CANTO Weekly Newsletter – BNamericas: 05/10/14



Chile’s VTR sees 10% revenue decline on forex movements – Chile, Puerto RicoVTR, the Chilean triple cable TV and telecoms unit of Liberty Global (Nasdaq: LBTYA), posted a 10% decline in revenues in dollar terms to US$225mn in the first quarter of 2014, despite subscriber growth, primarily due to the impact of foreign exchange, according to a statement.Rebased growth for VTR’s operations was 5%. The US dollar strengthened 5.3% against the peso in 1Q14.

At a group level, Liberty Global’s revenue rose 70% year-on-year (y-o-y) to US$4.53bn due primarily to the inclusion of the newly acquired Virgin Media in 1Q14 and, to a lesser extent, to positive foreign currency (FX) movements in key European currencies that strengthened against the US dollar. Adjusting for the impact of both the acquisition and FX, rebased growth was 2% y-o-y.

Liberty said that its Latin American operations contributed 14%, or 49,000 of the company’s 1Q14 revenue generating unit additions, with 32,000 net additions in Chile and 17,000 in its Puerto Rico operation. Of VTR’s 32,000 service additions, 14,000 of those were for internet services.

The company said that though the Chilean subscriber additions were below the 1Q13 record of 50,000, they were still the strongest first quarter result in six years.

Arpu in Chile increased 3.1% to 31,673 pesos (US$56) y-o-y. VTR ended the quarter with 1.21mn subscribers, up 3.6% from 1Q13.


VTR’s mobile telephony services offered as an MVNO added 11,700 subscribers in the quarter to reach 83,000 compared to 71,300 at the end of December 2013. VTR switched from being a mobile service provider to an MVNO in September last year, which Liberty said had helped the company reduce an operating cash flow deficit.

Liberty CEO Mike Fries said that the company expects to continue launching MVNO services throughout its operations in Europe in 2014.


In terms of TV, VTR said in a statement that it had reached 1mn homes during the quarter boosted by its offering of HD and premium content. VTR said that 87% of homes with VTR contracts were now subscribed to digital TV.

VTR recently launched an internet content platform that enables users to access content from multiple devices and includes access to 500 children’s movies and series.

Liberty said in January it is considering spinning off its Latin American assets: the 80% it controls in VTR in Chile and its 60% stake in Liberty Cablevisión in Puerto Rico.

In March, Chilean financial holding CorpGroup agreed to sell its 20% stake in VTR, in what was seen as a move to “put the house in order.”

Dominican Rep holds public consultation on digital TV norms – Dominican R.

The Dominican Republic’s telecoms regulator has launched a public consultation on the technical standards to be applied for the implementation of the ATSC digital TV format, Indotel said in a statement.

Starting from April 30, the public consultation will run for 30 days. The analog switch off is slated for end-2015.

The Dominican Republic opted for the ATSC standard that is being implemented in the US, bucking the trend in Latin America, where the largest countries have opted to implement the Brazilian adaptation of the Japanese ISDB-T standard.

Other countries or US territories that use ATSC include Canada, Puerto Rico, Mexico, US Virgin Islands, Honduras, El Salvador, American Samoa, Guam, South Korea, and the Northern Mariana islands.

Costa Rica’s ICE, Telefónica launch telephony, internet works – Costa Rica

Costa Rica’s state telco ICE and the local unit of Spain’s Telefónica (NYSE: TEF) launched fixed telephony and internet works expected to benefit 5,000 residents in Costa Rica’s Atlantic zone, according to a government release.

The projects totaled 250mn colones (US$453,000) and were granted as part of the Costa Rican national telecom fund Fonatel.

Improving internet access in the educational sector was the primary aim of the projects, which were spread across communities in La Roxana district, Pococí canton, and Pacuarito district, Siquirres canton, with the investment expected to directly impact 1,250 students in 15 area schools.

Fonatel plans to invest US$80mn in Costa Rica’s Pacific and Atlantic regions in 2014. Five projects have already been awarded in the upper northern region, while six initiatives are currently being developed in the southern region.

Entel grows in Q1 as profit drops – Regional

Chilean telco Entel saw revenue growth in Q1 driven by the incorporation of Peruvian mobile operations, data and fixed line services, as profit dropped on higher financing costs, the company said in an earnings release.

Entel’s revenue increased by 12% to 424bn pesos (US$748mn) in Q1, as the company incorporated 35.7bn pesos in revenue from Peruvian mobile operations following the acquisition of NII Holdings’ (Nasdaq: NIHD) local unit Nextel Perú last year.

However, the number of mobile subscribers in Peru continues to decline, falling by 4.8% to 1.49mn in the 12 months through Q1. However, this decline was partially offset by a strong increase in 3G clients, the release said.

Data and IT services revenue jumped 28% to 34.0bn pesos and fixed internet and TV services continued to see strong growth, albeit from a small base.

Meanwhile, mobile services revenue in Chile declined by 2% to 295bn pesos as a result of lower interconnection rates in the local market, Entel said.

Given the current softness in the Chilean mobile industry, the operator is continuing to focus on capturing higher-value customers and growing penetration in mobile data services.

The company’s net income fell by 9% to 33.9bn pesos, while Ebitda decreased by 7% and net financing costs increased as a result of Entel’s higher level of debt.

The telco recently announced that its investments in Chile and Peru would reach US$2.85mn in the 2014-16 period.

Panama elects Juan Varela as president – Panama

Juan Varela was elected as Panama’s new president on Sunday with 39.13% of the votes, according to Panama’s electoral court.

The former vice president of outgoing President Ricardo Martinelli’s administration will take office on July 1 after defeating top contenders José Arias of ruling center-right party Cambio Democrático and Juan Navarro of center-left Partido Revolucionario Democrático.

Juan Varela, of Partido Panameñista, had been vice president until August 2011, when Martinelli dismissed him, leading to the end of the Cambio Democrático-Partido Panameñista coalition.

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