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» Tele Norte Leste Participacoes Management Discusses Q1 2011 Results - Earnings Call Transcript
Alex ZornigThank you. Good morning everyone. Welcome to the conference call to discuss Oi’s results for 2011. The presentation is already available on our website. With me today are Francisco Valim, CEO of the company; Tarso Rebello, the Controller; and [Brad Borges], the new Chief Regulations Officer. Paulo Márcio, the previous one, left the company, two weeks ago; Eduardo Aspesi, the Chief Marketing Officer; Biar Contege, Treasurer and IR Officer and his team. Before talking about 2011 I wish to mention that with the approval of the corporate restructuring TNL and Coari have become extinct and TMAR has become a wholly owned subsidiary of OI SA Consequently the results presented in this conference pertain to OISA. The surviving company the new name for Brazil Oi S.A., as at the end of the December 2011 when the results of the other three companies have not yet been consolidated. Meanwhile to help you understand the business, we have presented a consolidated pro-forma results equivalent to the previous number of TNL consolidate, of the break in numbers revenue cost and expenses, EBITDA, debt, CapEx and cash flows, as if the merger has taken place on December 31, 2011. The results presented at a consolidated OI SA already correspond to the previous numbers of Brazil Telecom. Moreover, based on the strategic differential rising from the integration of the companies at the end of 2011, the company changed the way it conducts its business. Now, adapting an approach segment by applying, residential, corporate and personal mobility and no longer by private. This is aimed to increase Oi’s service share of total conception telecom service by clients, placing the company as a provider of end-to-end service. Moving onto the 2011 results. Slide number 5 or page number 5. RGUs grew 9% in 2011 with an increase of 5.7 million clients in the year driven by the positive performance of the personal mobility and corporate segment and by the lower decline in the residential segment especially in 4Q, 2011. The company ended the year 2011 with almost 70 million clients, of which 43.3 million were in the personal mobile segment, 80 million in the residential segment and eight million in the corporate segment.
The next slide; I the residential segment the company ended the year with 17.8 million RGUs in 13 million residences. As the first results of OI new market sizes, we highlight the performance on 4Q11, in which residential RGUs dropped by 0.4% showing a significant low decline in comparison with the previous quarter. One factor for this performance was the number of residence with three or more triple play service, TP, which grew 10% in the quarter.Being sure of loyalty of our client base, we continue to expand the high speed broadband offering. December 2011 average speed reached 2.5 megabytes, 44% faster than in December 2010. With 24% of the client base already using speeds over five megabytes and 11% over 10 megabytes. Believing in fresher potential of this service in 2011, the company continues to expand a coverage of [all], which reached more than 4.6 thousand cities, with the largest active network in the company. With regard to PNBL, we added 2011 offering the service in, 450 cities. Today we offer this service in more than a thousand cities. OIC PNBL has a growth opportunity and according to the agreement, 4,800 cities in each area of Brazil be covered by 2015. In November, we launched Oi Internet, which brings the complete broadband solution to the client. In the regions where it is offered, it already accounts for 15% of its sales. Also in order to increase the number of Oi products in the clients’ residence, the company focuses on its efforts on growing the Oi TV brands, as well as in fine tuning its products portfolio and redesigning its plans. This month we will launch our new offerings, even bundling them with residential conversion products. Corporate; the corporate segment closed the year with 7.8 million RGUs, 7.6% than 2010. Mobile users in the corporate segment amounted to 2.2 million in the fourth quarter of 2011, a 45% increase over 2010. Read the rest of this transcript for free on seekingalpha.com