Telecommunications company América Móvil SAB posted a third-quarter net loss as revenue weakened partly due to natural disasters in Mexico and Puerto Rico. AMX stocks took a significant drop over the past 48 hours from $19.50 per share to $17.45 at close of business Thursday.
Latin America’s biggest telecommunications company, controlled by billionaire Carlos Slim, reported a net loss of 9.5 billion pesos ($494 million) in the three months ending in September, compared with a 2.1 billion-peso profit a year before.
“A steeper than expected impact from recent natural disasters clouded what we generally viewed as constructive fundamental trends out of America Móvil, led by its businesses in Mexico and Brazil,” said Barclays Amir Rozwadowski. “However, as the trajectory of regulatory measures and competition/demand trends seem poised to continue in a favorable direction, we retain a constructive view on the shares,” he said.
Revenue fell 2.2 percent to 244.2 billion pesos, which was attributed to a combination of the weakening peso and sales interruptions caused by storms and tremors in Mexico and the Caribbean. The Mexican currency had fallen 4.2 percent against the U.S. dollar from its mid-July highs by the end of September. The company offered bonuses and credits to customers in Puerto Rico, which was battered by Hurricane Maria, and provided five days of free service in Mexico, which was struck by two deadly earthquakes in September.
“In Puerto Rico we provided bonuses to our prepaid clients and credited monthly fees to our postpaid clients; in Mexico, Telcel and Telmex opened their networks at no cost to their clients for five days, following the earthquakes on September 19,” the carrier said in a press release. “Excluding Puerto Rico—where service revenues collapsed 17.4%—and the U.S., revenue trends in our other operations remained very much in line with those seen through the second quarter.”
October 27, 2017