Millicom boss Mauricio Ramos (pictured) said the operator made progress on its ambitions to grow mobile data and cable revenue during Q4, but continued erosion of its voice and SMS services weighed on overall earnings.
The operator unveiled a strategic two-pronged reconfiguration of the business in mid-2016, with aims to boost growth in mobile data and expand its cable footprint, in a bid to evolve its revenue mix due to weaker performance of voice and SMS.
In Q4, the company’s revenue dropped 2.6 per cent year-on-year from $1.64 billion to $1.59 billion, while its net loss for the period narrowed from $426 million in Q4 2015 to $143 million in the recent period.
Adjusted EBITDA for the 2016 quarter was $566 million, up 3.1 per cent year-on-year.
Millicom will argue it is delivering on its strategic goals, and Ramos said mobile data and cable contributed to 50 per cent of total group service revenue, compared to 45 per cent the year before, “as we reach a pivotal point in our revenue mix”.
However, the growth was offset by voice and SMS, which Ramos said “reflects the changing patterns of customer usage seen in mobile market globally, and this constrains our total service revenue growth in Latam in the year”.
Declining voice and SMS revenue was “exacerbated” in Colombia, where the company has faced challenges for a while.
In Latin America, the company’s total mobile subscriber numbers dropped 1.8 per cent year-on-year to 32 million. However, it registered a 14 per cent increase in the number of mobile data customers, while 3.4 million customers in the region are now 4G customers.
Mobile data revenue in the region grew 17.5 per cent, while voice and SMS fell 16.7 per cent. Revenue totalled $1.4 billion, a 3.4 per cent decline.
Millicom’s African business generated revenue of around $217 million, with service revenue growing 10.5 per cent year-on-year.
The company separately announced it had sealed a deal to sell its business in Senegal to Wari group for $129 million, subject to regulatory approval.
It also started a process to divest a 22 per cent stake in Helios Towers Africa.