Millicom Q3 Profits Jump 77%
Millicom International Cellular has reported a 77% jump in Q3 revenues to US$686 million, from US$388 million a year ago - along with a 60% rise in EBITDA to $296 million. Net profit for Q3 rose to US$138 million, compared to US$52 million a year earlier.
Chief Executive Officer's Review Marc Beuls, Chief Executive Officer, comments: "Millicom continues to deliver excellent growth with a 77% increase in revenues year on year on the back of an acceleration of capex during the quarter to $347 million. This higher level of investment is reflected in the addition of 2 million customers during the quarter bringing the total to 20 million. Millicom is today increasing its capex forecast for the full year 2007 from $800m to over $1 billion as we continue to invest in future growth. We are expecting a similar level of capex for 2008”.
"The most encouraging aspect of these results has been in Africa where we have taken the opportunity to increase the pace of our build-out through a substantial increase in capex. This steadily increasing level of investment is driving the rate of subscriber acquisition in Africa which was up 44% year on year, up an impressive 17% quarter on quarter and delivering year on year revenue growth for the quarter of 52%. In order to exploit the growth opportunity in our African markets we have accepted a somewhat lower margin of 28% in the third quarter, but we still believe that margins will move back to historical levels whilst we continue to invest as we build critical scale. In our two newest African markets, Chad and DRC, revenues were up by 117% and 150% respectively and, encouragingly, in our two largest African markets, Ghana and Tanzania, year on year revenue growth in Q3 of 43% and 51% respectively, showed the positive impact of the price cuts in Q2. Also in Senegal, growth in revenues of 38% demonstrated that the one-off issues from Q2 are behind us. We continue to be excited by the prospects in Africa but reiterate our view that the lack of infrastructure will continue to be a challenge and this will mean higher levels of operating expenditure than in our other markets for the time being”.
“Overall, we see opportunities in all our markets to continue investing aggressively in order to increase our market share and to exploit the general growth in the market as penetration rates continue to rise across our markets. In Africa and Asia penetration is only just starting to move into this exciting high growth phase”.