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Fiber optics, corporate services driving Algar’s expansion

Bnamericas Published: Thursday, August 12, 2021
Fiber optics, corporate services driving Algar’s expansion

The expansion of the fiber optics network and higher demand for corporate services (B2B) were the main drivers of Brazil's Algar Telecom's business in the first six months of the year.

These factors led the company to resume investments and increase capex by 9.7% to 274mn reais (US$52.4mn) in the period, according to Algar's financial report. 

In Q2, investments grew 17.7% to 110mn reais. Network expansion and customer acquisition capex grew 24.2% to 96.1mn reais.

The company said it reinstated projects, actions and investments that had been suspended last year due to the pandemic in the first half but especially in Q2.

Algar also accelerated works to serve 24 new locations while hiring consultants to support strategic projects.

OPERATION

B2B revenues grew by 11.3% in Q2 to 383mn reais. The segment, deemed a priority for the group, now accounts for 63% of total sales.

At the end of June, Algar served the corporate market in 372 localities in 17 states as a result of a "strategic decision to expand its operations with a focus on this customer segment," the company said.

On the other hand, retail revenues dropped 4.1%, to 227mn reais, with the customer base declining 2.1% to 2.07mn subscribers.

In mobile, the company registered 1.11mn customers, down 0.8% year-over-year.

Fixed broadband business declined slightly due to the disconnection of the legacy network, involving copper cables and outdated technologies

But fiber-to-the-home grew 26% to 426,200 clients, reaching 84.6%, up 17.8 percentage points, of the fixed broadband customer base.

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