America Móvil, S.A.B. de C.V. — 2022 Form 20-F
Reporting period: Fiscal year ended December 31, 2022; filed May 1, 2023. Although the request references 2022 Q4, this filing reports annual results and does not provide a clear standalone fourth-quarter financial summary. Financial statements are prepared under IFRS in Mexican pesos; dollar conversions are for convenience.
Business context and reporting basis
America Móvil provides wireless, fixed-line, broadband, Pay TV and related services in 22 countries. Mexico and Brazil together account for more than half of its revenue-generating units. The 2022 figures reflect a changed business perimeter: Panama was sold, Chile became a 50:50 joint venture, and Latin American tower assets outside specified exceptions were spun off to Sitios. TracFone, sold in 2021, is also presented as discontinued operations in comparative periods. Comparisons below are therefore principally for continuing operations.
Financial and operating highlights
| Metric | 2022 | Comparison / context |
|---|---|---|
| Operating revenue | Ps.844.5 billion | Up 1.7% reported and 7.3% at constant exchange rates year over year. |
| Service revenue | Ps.713.0 billion | Up 2.7% reported and 8.0% at constant exchange rates; mobile, broadband and corporate services contributed to growth. |
| Operating costs and expenses | Ps.673.6 billion | Up 1.6% reported and 7.3% at constant exchange rates, reflecting energy, maintenance, leasing, IT and logistics costs. |
| Operating income and margin | Ps.170.9 billion; 20.2% | Income increased 2.0%; margin was unchanged from 2021. |
| Profit from continuing operations | Ps.88.2 billion | Up 22.4% from 2021; parent-attributable continuing profit was Ps.82.9 billion. |
| Discontinued operations and total profit | Ps.6.7 billion loss from discontinued operations; Ps.81.5 billion total net profit | Total profit was Ps.196.3 billion in 2021, which included a large TracFone disposal gain. 2022 basic and diluted EPS from continuing operations was Ps.1.30 per share. |
| Operating cash flow | Ps.225.3 billion | Down from Ps.258.2 billion in 2021. |
| Capital expenditure | Ps.159.8 billion | Versus Ps.158.7 billion in 2021; includes network and license investment. The filing does not present free cash flow as a headline metric. |
| Cash and cash equivalents | Ps.33.7 billion | Down from Ps.38.7 billion at year-end 2021. |
| Debt and liquidity | Ps.510.6 billion total debt; Ps.381.5 billion net debt | Total debt was Ps.564.0 billion in 2021. Ps.102.0 billion of debt was short-term/current. Lease liabilities were Ps.134.1 billion, reported separately from debt. |
| Assets and equity | Ps.1,618.1 billion total assets; Ps.437.8 billion total equity | Total assets and equity were Ps.1,689.6 billion and Ps.454.0 billion, respectively, at year-end 2021. |
Management stated that working capital was sufficient for present requirements and expected operating cash generation to cover long-term liquidity needs. Net debt is a management-defined measure and includes specified deductions for cash and certain investments.
Material changes versus 2021
- Reported revenue growth was modest, while constant-currency growth was stronger. The Mexican peso’s appreciation against several operating currencies reduced reported results in pesos.
- Operating margin held at 20.2%, but cost pressure increased. Commercial, administrative and general expenses rose to 21.2% of revenue from 20.9%.
- Net interest expense increased 14.2%. The company recorded a Ps.20.8 billion foreign-exchange gain, versus a Ps.16.7 billion loss in 2021, and a Ps.28.6 billion net loss on derivative valuation, versus a Ps.6.8 billion loss.
- Cash from operations declined despite higher continuing-operations profit; cash and cash equivalents also decreased. Total debt fell, while lease liabilities rose to Ps.134.1 billion from Ps.98.7 billion.
- Wireless subscribers increased to 299.9 million from 278.8 million; total RGUs increased to 373.1 million from 351.9 million. Fixed RGUs were broadly flat overall, with declines in Mexico and Brazil.
- Mexico Fixed operating income fell 23.4%; Southern Cone operating income fell 39.5%. Brazil and Europe reported higher segment operating income.
Outlook, commentary, risks and unusual items
- Outlook: Management budgeted 2023 capital expenditure of approximately US$8.6 billion (Ps.178.5 billion), primarily funded from operations. It expected input-cost and supply pressures to continue into 2023; no quantified revenue or earnings guidance is provided in the supplied filing text.
- Capital returns: Shareholders approved a Ps.0.46 per-share ordinary dividend for 2023, payable in two installments. The company paid Ps.29.5 billion in dividends and spent Ps.26.2 billion on share repurchases in 2022.
- Portfolio actions: The Panama sale closed July 1, 2022; the Chile combination with Liberty Latin America closed October 6, 2022; and the tower spin-off to Sitios closed August 8, 2022. The Chile transaction generated a reported loss, including recycling of accumulated translation losses, and the company continued to have tower-sharing arrangements with Sitios.
- Foreign exchange and derivatives: Most debt was denominated in currencies other than pesos before derivative effects; derivative fair value was a net liability of Ps.22.7 billion at year-end. Currency, interest-rate and derivative movements can materially affect reported earnings.
- Contingencies: The company disclosed significant tax assessments, particularly in Brazil, Mexico and Colombia, and material regulatory, antitrust and other legal proceedings. Brazilian tax contingencies totaled Ps.132.4 billion, with Ps.19.1 billion provided for probable losses. It cautioned that claims may be materially greater than recorded provisions.
- Internal controls: Management and the auditor identified a material weakness in IT general controls at a Colombian subsidiary, involving timely removal of user access and monitoring/logging user activity. Management reported no resulting material misstatement and no required financial-statement adjustment, but concluded disclosure controls and internal control over financial reporting were ineffective. The auditor issued an adverse opinion on internal control; the financial-statement audit opinion was unqualified.
- Other risks: The filing highlights intense competition and pricing pressure, regulation and asymmetric rules in Mexico, spectrum availability, inflation and energy costs, concession renewals, cyber and service interruptions, political and economic volatility, climate events, and the company’s exposure to litigation and related-party transactions.
Most important facts for investors to verify
- Reconcile continuing-operations growth with the prior-year reported total profit, which included the TracFone disposal gain, and confirm the effect of the changed reporting perimeter on comparability.
- Review cash-flow conversion, the Ps.33.7 billion cash balance, near-term maturities and the distinction between debt and lease liabilities.
- Assess the sustainability of margins and cash generation against higher energy, maintenance, labor, inflation and financing costs, as well as the 2023 capital-expenditure budget.
- Track remediation and independent testing of the Colombian IT-control weakness and any subsequent control or reporting developments.
- Review the status, potential exposure and collateral requirements for major tax and regulatory disputes, including Brazilian tax matters and Mexican asymmetric-regulation proceedings.
- Confirm the financial and operating effects of the Panama sale, Chile joint venture and Sitios tower spin-off, including ongoing related-party and infrastructure-sharing arrangements.