NEW YORK, LONDON and BERTRANGE, Luxembourg, Aug, 5, 2002 (PRIMEZONE) -- Millicom International Cellular SA (Nasdaq:MICC), the global telecommunications investor, today announces results for the quarter and six months ended June 30, 2002.
-- EBITDA Margin of 43% for the Six Months Ended June 30, 2002 -- 58% Annualized Growth in Prepaid Minutes -- 28% Annualized Increase in Total Subscribers -- Annualized Increase in EBITDA of 15% in Asia
Financial summary for the quarters ended June 30, 2002 and 2001 and March 31, 2002
June 30 March 31 June 30
2002 2002 2001
Worldwide subscribers (i)
* 2,696,376 2,580,792 2,150,501
- proportional cellular 3,748,274 3,581,910 2,936,929
- gross cellular
US$ '000
Revenues* 149,015 145,066 148,730
Operating profit before
depreciation and 64,340 63,667 60,364
amortization, EBITDA(ii)*
EBITDA margin* 43% 44% 41%
Profit before financing 55,566 14,053 22,624
and taxes
Loss for the period (14,038) (26,340) (38,209)
Loss per common MIC share (0.29) (0.54) (0.78)
(US$)
Weighted average number of 48,916 49,191 48,865
shares (thousands)
(i) Subscriber figures represent the worldwide total number of
subscribers of cellular systems in which MIC has an ownership
interest.
Subscriber figures do not include divested operations or the
subscribers of Tele2 AB, in which MIC has an 11.8% interest.
(ii) EBITDA; operating profit before interest, taxation, depreciation
and amortization, is derived by deducting cost of revenues, sales
and marketing costs, and general and administrative costs from
revenues.
* Excluding El Salvador and divested operations
N.B. Due to local issues in El Salvador, MIC has temporarily discontinued consolidating El Salvador on a proportional basis with effect from May 2001. All comparatives in this press release, otherthan those noted in the appendices, exclude divested operations and El Salvador in respect to subscribers and for financial results, up to and including EBITDA.
Marc Beuls, MIC's President and Chief Executive Officer stated: "EBITDA for the quarter increased by 7% year-on-year, despite the charges resulting from the cost-cutting exercise which most of MIC's operations implemented in the second quarter. The full benefit in the EBITDA margin will be seen at the start of quarter four. The growth in prepaid minutes was 58%, reflecting the strong underlying growth in the business. MIC Systems showed a very strong rebound from the year 2001, confirming its leading position in the telecoms clearing market. If currency devaluations were excluded, this growth would have been evident in the financial results with year-to-date revenue growing by approximately 7% and EBITDA by 14% on an annualized basis. Against a background of positive operating results, Millicom continues to increase its liquidity. Upstreaming of cash is being maximized and $60 million was received in the first half of 2002. The increasing operating margins combined with the selective sale of assets will provide MIC's liquidity going forward."
FINANCIAL AND OPERATING HIGHLIGHTS
- Subscriber growth:
-- An annualized increase in worldwide gross cellular subscribers of
28% to 3,748,274 as at June 30, 2002
-- An annualized increase in worldwide proportional cellular
subscribers of 25% to 2,696,376 as at June 30, 2002
-- In the second quarter of 2002 MIC added 166,364 net new gross
cellular subscribers
-- An annualized increase in proportional prepaid subscribers of 36%
to 2,297,581 as at June 30, 2002
- Financial highlights:
-- Revenue for the second quarter of 2002 was $149.0 million, a
quarterly increase of 3%
-- EBITDA increased by 7% in the second quarter of 2002 to $64.3
million, from $60.4 million for the second quarter of 2001
-- The Group EBITDA margin was 43% in the second quarter of 2002,
increasing from 41% in the second quarter of 2001
-- Excluding the non-cellular businesses, the Group EBITDA margin
was 45%
- Total cellular minutes increased by 30% on an annualized basis for the
six months ended June 30, 2002, with prepaid minutes increasing by 58%
in the same period
- $60 million has been upstreamed from operations in the first half of
2002
- Net operating debt reduced by $12 million in the quarter
- Interest in the second quarter of 2002 was 8% lower than for the
second quarter of 2001
In quarter two 2002 MIC received U.S. $30 million as final payment on the sale of FORA Telecom to Tele2 AB, following the award of GSM 1800 licenses to Tele2 AB in St. Petersburg, its surrounding area and two other Russian cities
In May 2002 MIC announced it was in the process of selling its holding in MIC Systems including MACH, the world's largest GSM roaming clearing house, expected to be concluded in the third quarter of 2002
REVIEW OF OPERATIONS
SUBSCRIBER GROWTH
At June 30, 2002, MIC's worldwide cellular subscriber base increased by 28% to 3,748,274 from 2,936,929 at June 30, 2001. Particularly significant annualized percentage increases were recorded in Pakistan and Central America. MIC's proportional cellular subscriber base increased by 25%, to 2,696,376 at June 30, 2002, from 2,150,501 at June 30, 2001. Sanbao Telecom showed an annualized increase in proportional cellular subscribers of 49%.
Within the 2,696,376 proportional cellular subscribers reported at the end of the second quarter, 2,297,581 were prepaid customers, representing a 36% increase on the 1,693,093 proportional prepaid subscribers recorded at the end of June 2001. Prepaid subscribers currently represent 85% of gross reported proportional cellular subscribers.
FINANCIAL RESULTS FOR THE THREE MONTHS ENDED JUNE 30, 2002
Total revenues for the three months ended June 2002 were $149.0 million, an increase of 3% from the previous quarter.
Annualized revenue growth was 15% for MIC Systems with total revenue only marginally less than the quarterly record of Q3 2001, reflecting the significant recovery in international roaming related revenues. Sanbao Telecom recorded revenue growth of 6% on annualized basis, with Vietnam producing annualized growth of 21%.
The volatile economic situation in Latin America is reflected in the 8% decrease in second quarter revenues relative to 2001. Paraguay and Bolivia saw annualized quarterly revenue reductions of 26% and 24% respectively, although, had it not been for the severe currency devaluations, Paraguay's revenue would have increased. Colombia however, reported an annualized increase in revenue of 21%. In the Central American market, Honduras produced an annualized revenue increase of 6% and Guatemala recorded a 10% increase in revenues from the first quarter of 2002.
EBITDA for the three months ended June 30, 2002 was $64.3 million, an increase of 7% from June 30, 2001. EBITDA for Sanbao Telecom increased by 15% in the quarter on an annualized basis reflecting the benefit of cost cutting measures and the 11% growth in MIC Africa was in large part due to the focus on high margin customers in Senegal.
The positive effect of cost cutting in Latin America was reflected in the EBITDA for the region, which increased slightly from the first quarter of 2002 despite the adverse currency movement. This is particularly reflected in Colombia and Honduras, which recorded annualized increases of 49% and 20% respectively.
The EBITDA margin for MIC was 43% for the quarter. Notably, Vietnam and Honduras recorded quarterly EBITDA margins of 63% and 55% respectively.
Upstreaming of cash from operations amounted to $27 million in the quarter.
FINANCIAL RESULTS FOR THE SIX MONTHS ENDED JUNE 30, 2002
Total revenues for the first half of 2002 were $294.1 million with revenues for Africa and Asia increasing by 8% and 6% respectively and revenues for MIC Systems increasing by 7% relative to the first half of 2001. Revenues for Latin America for the first half of the year decreased by 8%, due significantly to currency devaluations. Had exchange rates held at June 2001 levels, revenue growth for Africa, Asia and Latin America would have been approximately 16%, 8% and 3% respectively.
EBITDA for the first half of 2002 was $128 million. Most notably MIC Systems recorded a 23% increase in EBITDA for the six months ended June 30, 2002. The respective increases for Asia and Africa were 17% and 9%. All regions benefited from additional cost cutting measures and, had it not been for the devaluations in Latin America, EBITDA growth on an annualized basis would have been positive. Excluding non-cellular businesses the EBITDA margin exceeded 45% year to date.
Growth of minutes in Asia and Latin America was particularly strong with annualized prepaid growth being 73% and 57% respectively, whilst total minute growth was 31% and 34% respectively. The addition of Interfact to MIC Systems has resulted in an 83% increase in total annualized chargeable data for MIC Systems.
The high-speed wireless data operations in Argentina and Peru each recorded year-to-date EBITDA margins of 19%.
Millicom International Cellular S.A. is a global telecommunications investor with cellular operations in Asia, Latin America and Africa. It currently has a total of 19 cellular operations and licenses in 18 countries. The Group's cellular operations have a combined population under license (excluding Tele2) of approximately 496 million people. In addition, MIC operates the world's largest GSM clearing house and has licenses to provide high-speed wireless data services in eight countries. MIC also has an 11.8 % interest in Tele2 AB, the leading alternative pan-European telecommunications company offering fixed and mobile telephony, data network and Internet services to over 15 million people in 21 countries. The Company's shares are traded on the Nasdaq Stock Market under the symbol MICC.