Business Context and Reporting Period
Company: América Móvil, S.A.B. de C.V. (NYSE: AMX, AMOV)
Filing Type: Form 6-K (Report of Foreign Private Issuer)
Reporting Period: Fourth Quarter and Full Year ended December 31, 2021
Filing Date: February 11, 2022
América Móvil reported financial and operating results for Q4 2021. The consolidated figures exclude TracFone, which was sold to Verizon on November 23, 2021, and is now classified as a discontinued operation. Argentina's results are presented under inflationary accounting (IAS 29) and are excluded from constant exchange rate comparisons.
Key Financial Metrics
| Metric | Q4 2021 | Q4 2020 | YoY Change |
|---|---|---|---|
| Total Revenue | MxP 227.3 Billion | MxP 211.1 Billion | +7.7% |
| Service Revenue | MxP 179.7 Billion | MxP 170.4 Billion | +5.4% |
| Adjusted EBITDA | MxP 82.9 Billion | MxP 76.1 Billion | +8.9% |
| Adjusted EBITDA Margin | 37.6% | 36.0% | +160 bps |
| Net Profit (Continuing Ops) | MxP 22.9 Billion | MxP 32.7 Billion | -30.0% |
| Net Profit (Total) | MxP 135.6 Billion | MxP 37.3 Billion | +263.4% |
| Net Debt (Excl. Leases) | MxP 400.7 Billion | MxP 537.8 Billion | -25.5% |
| Net Debt / EBITDAaL | 1.23x | N/A | - |
Full Year 2021 Highlights: Net income totaled MxP 196.0 billion (MxP 70.7 billion from continuing operations). Free cash flow was MxP 115.3 billion, funding MxP 170 billion in CapEx and MxP 65 billion in shareholder distributions.
Material Changes vs. Prior Period
- Subscriber Growth: Added 4.8 million wireless net adds in Q4 (2.2M postpaid, 2.5M prepaid). Total wireless base reached 287 million. Fixed-line broadband added 72k clients, though total fixed-line RGUs declined 139k due to PayTV and voice disconnections.
- Revenue Drivers: Service revenue grew 4.4% at constant exchange rates. Mobile service revenue rose 6.9% (prepaid accelerated to 8.7%), while fixed-line service revenue grew 0.5%.
- Profitability Impact: Reported Net Profit surged 263.4% YoY primarily due to MxP 112.7 billion in gains from the sale of TracFone (discontinued operations). Adjusted operating profit from continuing operations grew 20.1% in nominal terms.
- Balance Sheet: Net debt reduced by MxP 128 billion in flow terms during 2021. The company prepaid bonds totaling MxP 2.35 billion (EUR 750M + USD 1.6B) using TracFone proceeds.
Guidance, Outlook, and Risks
- Capital Allocation: The company increased its share buyback fund by MxP 26 billion for the period April 2021–April 2022.
- Strategic Moves: Completed the sale of TracFone to Verizon for ~USD 3.6 billion cash plus Verizon stock. Acquired significant 5G spectrum in Brazil (3.5GHz, 2.3GHz, 26GHz bands).
- Regional Performance:
- Brazil: Strong postpaid growth (1.1M net adds); mobile service revenue +8.0%.
- Mexico: Prepaid growth led by Telcel; service revenue +6.4%.
- Argentina: Service revenue grew 1.1% in real terms despite hyperinflation; subscriber base up 8.9%.
- Chile: EBITDA declined 14.8% YoY due to competitive pricing pressures and roaming agreement termination.
- Risks: Inflationary pressures in the region (specifically Argentina), currency volatility, and intense competition in mobile and fixed-line segments affecting ARPU and margins in certain markets.
Investor Verification Checklist
- TracFone Impact: Verify the sustainability of earnings excluding the one-time MxP 112.7 billion gain from the TracFone divestiture.
- Argentina Accounting: Confirm understanding of IAS 29 inflationary accounting adjustments and their exclusion from constant currency comparisons.
- Debt Reduction: Validate the net debt reduction of MxP 128 billion and the utilization of TracFone proceeds for bond prepayments.
- Fixed-Line Trends: Monitor the divergence between broadband growth (+72k) and PayTV/voice disconnections (-211k) in the fixed-line segment.
- Buyback Program: Track execution of the newly approved MxP 26 billion share repurchase fund.