Telmex plans US$834mn capex this year as Q4 profits plummet 32%

- Friday, February 4, 2011

Telmex plans US$834mn capex this year as Q4 profits plummet 32%

Mexican telecoms operator Telmex (NYSE: TMX) expects capex in 2011 to reach 10bn pesos (US$834mn), company CFO Adolfo Cerezo said during a conference call with investors.

The executive said some 70% of that capex will be used to drive the operator's transport network. Capex this year will be used to support growth in the broadband segment, Cerezo added.

In 2010, the company invested US$840mn. Capex for the last quarter of the year alone reached US$324mn.

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Telmex posted a net profit of 3.39bn pesos in the quarter, falling 32.1% compared with 4.99bn pesos in the year-ago period.

The operator generated revenues of 28bn pesos in the period, down 6% compared with the same period the previous year.

Ebitda reached 11.1bn pesos in Q4, down 9.4% year-on-year. The company's Ebitda margin in the quarter was 39.7%, down 1.5 percentage points compared with the same period the previous year.

In the fixed telephony segment, the telco ended 2010 with 15.6mn lines, after a loss of 291,000 lines during the year.

Cerezo said the fixed voice business will continue to decline this year. "We are not expecting to see growth in the voice business. We have to accept it. But we have all of our effort focused on the broadband business," Cerezo said.

Telmex also ended the year with 7.44mn internet connections, compared with 6.65mn at end-2009. Broadband connections reached 7.36mn at end-2010. "We continue pushing for increasing growth in the broadband services. We continue to add more features to these services for our customers," Cerezo added.