Business Context and Reporting Period
Company: América Móvil, S.A.B. de C.V.
Filing Type: Form 6-K (Report of Foreign Private Issuer)
Reporting Period: First Quarter 2023 (Ended March 31, 2023)
Announcement Date: April 25, 2023
América Móvil is a leading telecommunications provider operating primarily in Latin America and Europe. The company reported financial and operating results for Q1 2023, highlighting subscriber growth in postpaid segments and fixed-line broadband, offset by prepaid disconnections in Brazil due to the migration of former Oi subscribers.
Key Financial Metrics
| Metric | Q1 2023 | Q1 2022 | YoY Change |
|---|---|---|---|
| Total Revenue (MXN Billion) | 208.9 | 205.5 | +1.7% |
| Service Revenue (MXN Billion) | 169.1 | 172.8 | -2.2% |
| Service Revenue (Constant FX) | - | - | +6.3% |
| EBITDA (MXN Billion) | 82.7 | 80.1 | +3.2% |
| EBITDA Margin | 39.6% | 39.0% | +60 bps |
| Operating Profit (EBIT) (MXN Billion) | 44.1 | 40.2 | +9.7% |
| Net Income (MXN Billion) | 30.1 | 30.8 | -2.1% |
| EPS (MXN) | 0.48 | 0.48 | 0.0% |
| Capital Expenditures (MXN Billion) | 29.2 | 28.6 | +2.0% |
| Net Debt (MXN Billion) | 365.1 | 381.5 | -4.3% |
| Net Debt / LTM EBITDAaL | 1.39x | - | - |
Material Changes vs. Prior Period
- Subscriber Dynamics: Added 1.1 million net wireless subscribers, driven by 1.9 million postpaid additions (notably 944k in Brazil, 285k in Austria). Conversely, prepaid segment saw 754k net disconnections, primarily due to the removal of 1.6 million inactive former Oi subscribers in Brazil.
- Revenue Composition: Total revenue grew 1.7% in nominal pesos but declined 2.2% in service revenue due to the appreciation of the Mexican peso against operating currencies. At constant exchange rates, service revenue grew 6.3%.
- Profitability: Operating profit rose 9.7% to 44.1 billion pesos. Net income decreased 2.1% to 30.1 billion pesos, primarily due to a reduction in foreign exchange gains (down from 22.5 billion pesos in Q1 2022 to 13.7 billion pesos in Q1 2023).
- Fixed-Line Growth: Fixed-line service revenue grew 1.8% at constant exchange rates, the best performance in over a year, driven by broadband expansion in Mexico, Brazil, and Colombia.
- Debt Reduction: Net debt decreased by 16.4 billion pesos from the end of 2022, funded by operating cash flow, net borrowings, and the release of pension fund assets.
Guidance, Outlook, and Management Commentary
- Capital Allocation: Shareholders approved a 20 billion peso share buyback program for the period April 2023 to April 2024. The company executed 1.9 billion pesos in buybacks during Q1.
- Strategic Moves: Extended the shareholders agreement with OBAG for Telekom Austria for 10 years. Agreed to support the spin-off of mobile towers in Austria to improve capital efficiency.
- Corporate Networks: Corporate networks revenue increased 12.1% year-over-year, driven by IT solutions and infrastructure services.
- Argentina Inflation: Financial results for Argentina are presented in accordance with IAS 29 due to hyperinflation. Comparisons at constant exchange rates exclude Argentina to ensure consistency.
- Discontinued Operations: Claro Panama and Claro Chile are reported as discontinued operations following their sale and joint venture establishment, respectively.
Investor Verification Checklist
- FX Impact: Verify the sensitivity of consolidated service revenue to the Mexican peso's appreciation against the Brazilian Real, Colombian Peso, and Euro.
- Brazil Prepaid Cleanup: Confirm the timeline and financial impact of the full migration and disconnection of former Oi subscribers in Brazil.
- Argentina Inflation Accounting: Review the specific adjustments made under IAS 29 for Argentina and the exclusion of this region from constant currency comparisons.
- One-Time Gains: Assess the impact of tower sales in the Dominican Republic and Peru on EBITDA and Free Cash Flow.
- Debt Maturity: Analyze the composition of the 365.1 billion pesos net debt, specifically the mix of peso-denominated vs. foreign currency debt.