BERTRANGE, Luxembourg, Aug. 03, 2004 (PRIMEZONE) --Millicom:
. Record quarterly total subscriber increase for Q2 04 of
474,996 *(i)
. 50% increase in revenues for Q2 04 to $216.0m (Q2 03:
$143.9m)*
. 47% increase in EBITDA for Q2 04 to $107.7m (Q2 03: $73.4m)*
. Profit for Q2 04 of $14.8m (2003: $176.0m)
. Profit per common share of $0.17 for Q2 04 (Q2 03: $2.70)
. 52% increase in revenues for the first half of 2004 to
$429.9m (2003: $282.6m)*
. 51% increase in EBITDA for the first half of 2004 to $214.5m
(2003: $142.4m)*
. Profit for the first half of 2004 of $29.5m (2003: $202.3m)
. Profit per common share of $0.39 for the first half of 2004
(2003: $3.11)
New York, Stockholm, London and Luxembourg -- August 3, 2004 --Millicom International Cellular S.A. (Nasdaq Stock Market: MICC,Stockholmsborsen and Luxembourg Stock Exchange: MIC), the globaltelecommunications investor, today announces results for thequarter and six months ended June 30, 2004.
Financial summary for the quarters ended June 30, 2004 and 2003*
June 30 June 30 Change
2004 2003
Worldwide subscribers (i)
- proportional cellular(ii) 4,421,185 3,083,955 43%
- total cellular 6,372,367 4,471,835 43%
US$ `000
Revenues 216,049 143,862 50%
Operating profit before
interest, taxes, 107,705 73,403 47%
depreciation and
amortization, EBITDA(iii)
EBITDA margin 50% 51%
Profit for the quarter 14,786 176,035
Basic profit per common 0.17 2.70
share (US$)
Diluted profit per common 0.17 2.58
share (US$)
Weighted average number of 86,094 65,138
shares (thousands)
Weighted average number of
shares and dilutive 89,601 68,655
potential shares (thousands)
(i) Subscriber figures represent the worldwide total number of subscribers of cellular systems in which MIC has an ownership interest.
Subscriber figures exclude divested operations.
(ii) Proportional subscribers are calculated as the sum of MIC's percentage ownership of subscribers in each operation.
(iii) EBITDA; operating profit before interest, taxation,depreciation and amortization, is derived by deducting cost ofsales, sales and marketing costs, and general andadministrative costs from revenues.
* Due to local issues in El Salvador, MIC discontinued consolidating El Salvador on a proportional basis from May 2001 to September 2003. Figures for 2003 in this press release therefore exclude divested operations and El Salvador in respect to subscribers and for financial results, down to and including EBITDA. Figures for 2004 include El Salvador and exclude divested operations for subscribers and financial results, down to and including EBITDA.
Marc Beuls, MIC's President and Chief Executive Officer stated: "MIC has built on the buoyant start of 2004 by producing revenue growth of over 50 % whilst keeping the EBITDA margin at 50% in the second quarter of 2004. MIC added 474,996 net new total cellular subscribers in the second quarter of 2004, the highest quarterly absolute increase in subscribers excluding El Salvador and divested operations on record, bringing the total subscribers for the Group to almost 6.4 million at the end of June 2004. The accelerated subscriber growth is driven by the increase in capex spent since the third quarter of 2003 but does not yet include the impact of our recent investment in four GSM networks in Latin America, which will all be launched by the end of August 2004.
"Paktel, one of our operations in Pakistan, has finalized phase one of the build-out of its GSM network and has asked permission from the PTA (the Pakistan regulator) to launch the service nationwide. Paktel's license was modified in 2002 to allow the company to market GSM services, subject to Paktel committing to invest US$150 million within 3 years, paying Rs200 million in administrative fees and lowering existing tariffs by at least 20%. Despite being in compliance with the modified license terms and conditions however, Paktel has been prevented from launching its GSM network and has been ordered by the PTA to pay an additional US$38.8 million in order to launch its GSM network. Paktel fundamentally disagrees with the order and has, in line with the prescribed process, launched an appeal in the Pakistan High Court. In the light of the planned GSM migration, both Paktel and Pakcom stopped investments in the TDMA network in the beginning of 2004, which impacted revenues slightly in the second quarter.
"As I indicated last quarter, revenues in Vietnam were impacted by the tariff reduction introduced on May 1st and by changes in the interconnect terms. We noticed, however, increases of 11 and 8 percent in minutes of use respectively for the prepaid and postpaid market in June from the previous month and expect that revenues will again be at the April level in July. It confirms once more the price elasticity in the mobile industry in the emerging markets. New tariff reductions have been decided by the VNPT starting August 1st. We expect to see a similar impact in Q3 as we experienced in Q2.
"The benefits of further investment in GSM networks saw MIC Africa perform particularly strongly, producing year-on-year quarterly growth in revenues and EBITDA of 91% and 68% respectively. Growth in our West African operation Ghana has been particularly strong since the beginning of this year.
"Our operations in Central America continue to show good growth and, in South America, both Bolivia and Paraguay produced their highest quarterly revenue increases for several years, giving us confidence that the Latin American markets will continue to improve, fuelled by the GSM migration in Paraguay, Guatemala, El Salvador and Honduras under the common Tigo brand. Telemovil, our operation in El Salvador has been improving its profitability over the quarter and is approaching the MIC average."
FINANCIAL AND OPERATING SUMMARY*
. Subscriber growth:
- An annual increase in total cellular subscribers of 43% to
6,372,367 at June 30, 2004
- 32% underlying annual growth in total cellular subscribers
excluding El Salvador
- An annual increase in proportional cellular subscribers of 43%
to 4,421,185 at June 30, 2004
- 28% underlying annual growth in proportional subscribers
excluding El Salvador
- In the second quarter of 2004 MIC added 474,996 net new total
cellular subscribers
- Proportional prepaid subscribers increased to 3,915,886 from
2,764,099 at June 30, 2003
. Financial highlights:
- Revenues for the second quarter of 2004 were $216.0 million, an
increase of 50% from the second quarter of 2003. Excluding El
Salvador the increase was 26%.
- EBITDA increased by 47% in the second quarter of 2004 to $107.7
million, from $73.4 million for the second quarter of 2003.
Excluding El Salvador, the increase was 24%.
- Total shareholders' equity at June 30, 2004 was ($4.3m)
compared to ($85.2m) at December 31, 2003.
- Profit for the second quarter of 2004 was $14.8 million,
compared to $176.0 million for the second quarter of 2003. The
profit for the second quarter of 2003 included an amount of
$161.2 million relating to the gain and valuation movement on
investment in securities and the gain on debt restructuring.
- Capital expenditure for the three months ended June 30, 2004
was $42.0 million and for the six months ended June 30, 2004 was
$103.3 million.
. Total cellular minutes increased by 48% for the three months
ended June 30, 2004 from the same quarter in 2003 and increased by
32% excluding El Salvador. Prepaid minutes increased by 57% in
the same period and by 47% excluding El Salvador.
. On April 26, 2004 Millicom called the entire outstanding
amount of its 2% Senior Convertible PIK Notes Due 2006 for
redemption in cash in accordance with the terms of the Indenture
covering the 2% Notes. A total of $63,371,000 of the 2% Notes was
converted into shares of MIC common stock, with a par value of
$1.50 each from the initial amount of $63,531,000.
. Subsequent events:
- On July 1, 2004, Telecel S.A., Millicom's operation in
Paraguay, launched GSM services in the 850MHz frequency, covering
95 cities and towns, under the brand name of Tigo.
REVIEW OF OPERATIONS
SUBSCRIBER GROWTH*
In the second quarter of 2004 MIC's worldwide operations in Asia, Latin America and Africa added 474,996 net new total cellular subscribers. On a proportional basis, MIC added 293,155 subscribers, bringing the number of proportional cellular subscribers at June 30, 2004 to 4.4 million.
At June 30, 2004, MIC's total cellular subscriber base increased by 43% to 6,372,367 cellular subscribers from 4,471,835 as at June 30, 2003. Particularly significant percentage increases were recorded in Ghana, Senegal, Sierra Leone and Vietnam. MIC's proportional subscriber base increased to 4,421,185 at June 2004 from 3,083,955 at June 30, 2003, an increase of 43%.
Within the 4,421,185 proportional cellular subscribers reported at the end of the second quarter, 3,915,886 were prepaid subscribers. Excluding El Salvador, proportional prepaid subscribers increased by 29% from June 2003. Prepaid subscribers currently represent respectively 87% and 89% of total and proportional cellular subscribers.
Cellular Operations (i)*
Proportio Proportio Annua Total Total Annua
nal (ii) nal (ii) lized Subs at Subs at lized
Subs at Subs at Increase June 30, June 30, Incre
June 30, June 30, 2004 2003 ase
2004 2003 Dec 31,
2002*
South
East
Asia 883,229 562,246 57% 1,939,790 1,222,404 59%
South
Asia 1,063,081 831,671 28% 1,271,138 1,005,761 26%
MIC Asia 1,946,310 1,393,917 40% 3,210,928 2,228,165 44%
Central 1,037,755 431,124 141% 1,523,790 811,731 88%
America
South 754,900 962,240 -22% 774,304 986,397 -22%
America
MIC Latin 1,792,655 1,393,364 29% 2,298,094 1,798,128 28%
America
MIC 682,220 296,674 130% 863,345 445,542 94%
Africa
Total 4,421,185 3,083,955 43% 6,372,367 4,471,835 43%
Cellular
Ops
(i) All numbers and comparatives exclude divested operations.
(ii) Proportional subscribers are calculated as the sum of
MIC's percentage ownership of subscribers in each operation.
* Due to local issues in El Salvador, MIC discontinued
consolidating El Salvador on a proportional basis from May
2001 to September 2003. Figures for 2003 therefore exclude El
Salvador. Figures for 2004 include El Salvador.
FINANCIAL RESULTS FOR THE THREE MONTHS ENDED JUNE 30, 2004*
Total revenues for the three months ended June 30, 2004 were $216.0 million, an increase of 50% from the second quarter of 2003, reflecting the increasing trend of growth in MIC's operations and the reconsolidation of El Salvador. MIC recorded revenue growth in Africa of 91% to $35.2m in the second quarter of 2004 compared with the same period in 2003, with Ghana producing growth of 170%. Revenues for Asia for the second quarter of 2004 increased by 21% from the same period last year, to $81.5 million, with $51.8 million for South East Asia and $29.7 million for South Asia.
Second quarter revenues for Latin America increased by 78% from the second quarter of 2003, mainly because of the reconsolidation of El Salvador, or by 13% if El Salvador is excluded. The Central American market continued to perform strongly, producing a 130% increase in revenues from the second quarter of 2003 and by 15% excluding El Salvador. In South America, Bolivia and Paraguay produced revenue increases of 7% and 14% respectively, their highest year-on-year quarterly increases for several years, pointing to a sustained recovery in the region.
Second quarter revenues for South East Asia were $51.8 million compared to $55.7 million in the first quarter of 2004. This decrease was mainly due to the tariff reduction introduced on May 1st and to changes in the interconnect terms in Vietnam. A 10 percent increase in total minutes of use was however recorded in June as compared to May, and revenues are expected to return to the April level in July.
Second quarter revenues for South Asia were $29.7 million compared to $30.6 million in the first quarter of 2004. This decrease was partly due to the fact that, in light of the planned GSM migration of Paktel, both Paktel and Pakcom stopped investments in the TDMA network at the beginning of 2004, which impacted revenues slightly in the second quarter.
EBITDA for the three months ended June 30, 2004 was $107.7 million, an increase of 47% from the quarter ended June 30, 2003. EBITDA for Africa increased by 68% to $14.0 million in the second quarter of 2004 from $8.3 million in the second quarter of 2003, with the most impressive growth occurring in Ghana. EBITDA for Asia was $47.4 million for the second quarter, an increase of 24% from the same period in 2003, with increases of 28% and 16% for South East Asia and South Asia respectively. Latin America recorded growth in EBITDA of 78% from the second quarter of 2003 to $46.4 million, following the reconsolidation of El Salvador, with a strong increase of 22% produced by Guatemala. Excluding El Salvador, EBITDA grew by 16%. The quarterly EBITDA margin for Asia was 58%, (63% for South East Asia and 50% for South Asia), for Latin America it was 48% (51% for Central America and 38% for South America) and for Africa it was 40%.
FINANCIAL RESULTS FOR THE SIX MONTHS ENDED JUNE 30, 2004*
Total revenues for the first half of 2004 were $429.9 million, an increase of 52% from the first half of 2003. Revenues for Africa were $66.9 million, increasing by an impressive 83%. In Asia revenues increased by 27% from the first half of 2003 to $167.9 million, with $107.5 million recorded for South East Asia and $60.4 million for South Asia. Revenues for Latin America for the first half of the year increased by 77% to $191.1 or by 13% to $121.8 million if El Salvador is excluded. Revenues for Central America (including El Salvador) and South America were $139.5 million and $51.6 million respectively.
EBITDA was $214.5 million for the first half of 2004, an increase of 51% over the first half of 2003. Most notably Africa recorded a 79% increase to $27.3 million for the six months ended June 30, 2004. EBITDA for Asia was $97.4 million, up 31% from the first half of 2003, with $65.5 million and $31.9 million recorded for South East Asia and South Asia respectively. EBITDA for Latin America increased by 76% to $89.9 million with $69.9 million recorded for Central America and $20.0 million recorded for South America. Excluding El Salvador, EBITDA for Latin America for the first half of the year increased by 16% from the same period in 2003. The Group EBITDA margin for the six months to June 30, 2004 was 50%, for Asia it was 58% (61% for South East Asia and 53% for South Asia), for Latin America it was 47% (50% for Central America and 39% for South America) and for Africa it was 41%.
Total cellular minutes increased by 52% for the first half of 2004 compared with the same period in 2003.
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 16 cellular operations and licenses in 15 countries. The Group's cellular operations have a combined population under license of approximately 387 million people.
This press release may contain certain ``forward-looking statements" with respect to Millicom's expectations and plans, strategy, management's objectives, future performance, costs, revenues, earnings and other trend information. It is important to note that Millicom's actual results in the future could differ materially from those anticipated in forward-looking statements depending on various important factors. Please refer to the documents that Millicom has filed with the U.S. Securities and Exchange Commission under the U.S. Securities Exchange Act of 1934, as amended, including Millicom's most recent annual report on Form 20-F, for a discussion of certain of these factors.
All forward-looking statements in this press release are based on information available to Millicom on the date hereof. All written or oral forward-looking statements attributable to Millicom International Cellular S.A., any Millicom International Cellular S.A. members or persons acting on Millicom's behalf are expressly qualified in their entirety by the factors referred to above. Millicom does not intend to update these forward-looking statements.
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