Thursday, February 23, 2012

Telefónica Sees Growth in Latin America and Mobile Broadband

in line with its prior financial guidance, Telefónica reported 2011 consolidated revenues of over 62,800 million euros, up 3.5% for the year. Growth was driven by the increase in wireless data revenues (+19% in organic terms) and growth in Latin America (+13.5%), a region which already represents 47% of the Group's total consolidated revenues. Telefónica increased its customer base by +7% year-on-year, reaching 306.6 million accesses as at 31 December 2011.

César Alierta, Chairman of Telefónica, stated "On the one hand, we have increased our customer base to exceed the 306 million mark, while the Company’s strategy to strengthen its competitive position is already paying off, showing a significant increase in the commercial activity in the second half of the year, and a remarkable growth in mobile broadband. In 2011, Telefónica has led the increase of penetration of mobile broadband services in its markets, with more than 38 million customers at the end of the year, 61% above 2010 figure. As a result, mobile data revenue also grew significantly to almost 20% in organic terms, and now represents 31% of mobile service revenues."

Some highlights:

Telefónica’s mobile accesses stood at 238.7 million in 2011, with a year-on-year increase of 8% in organic terms, following an acceleration in the growth rate during the second half of the year. It is worth highlighting net additions registered during the fourth quarter, reaching a record in the year (7.8 million accesses, excluding the disconnection of 1 million inactive prepaid accesses in Brazil in December), with a year-on-year increase of 45%.

Mobile broadband accesses -accesses with a data rate attached and therefore active users of the service- exceeded 38 million at the end of 2011 (+61% year-on-year). This figure represents a penetration rate of 16% over Telefónica's total mobile access base. Telefónica Europe reached a penetration rate of 31%, followed by Telefónica España (29%).

Retail fixed broadband accesses reached a total of 18.0 million (+5% year-on-year).

The number of Pay TV accesses stood at 3.3 million in 2011 (+19% year-on-year), with a pickup in the growth rate, basically due to the successful commercial repositioning in Latin America, where net additions in 2011 tripled those of 2010, the inclusion of TVA's Brazilian customers as of June and the good commercial performance in Spain during the second half of the year.

Fixed telephony accesses reached 40.1 million, down 3% year-on-year. This decline remained stable throughout 2011.

CapEx in 2011 reached 10,224 million euros, with a 3.3% year-on-year increase in organic terms. In reported terms, CapEx declined 5.7% year-on-year. It is important to mention that the 2011 CapEx figure includes the cost of the spectrum in Spain, Brazil and Costa Rica, amounting to 1,296 million euros.