MEXICO CITY, July 28 /PRNewswire-FirstCall/ -- Grupo Iusacell, S.A. de C.V. (BMV: CEL), reported its financial results corresponding to the second quarter of 2006.
Financial Information
Million pesos as of June 30, 2006
Change Change
2Q05 2Q06 $ % 6M05 6M06 $ %
Net Revenues 1,460 1,852 392 27% 2,831 3,653 822 29%
Total Cost 763 1,115 353 46% 1,440 2,210 769 53%
Operating Expenses 389 437 48 12% 808 870 62 8%
EBITDA 308 300 (9) 3% 583 573 (9) (2%)
Net Loss (34) (867) (833)(n.m.) (409) (1,355) (946) (231%)
Recent Events
As of July 2006, Iusacell's subscribers will now have international data service for easy access to mobile applications as a result of Iusacell's entering into a new agreement with Sprint of the USA. The Sprint data roaming agreement for coverage in North America is part of the international expansion of Iusacell in 2006.
Iusacell is extending the network coverage for its clients through data roaming agreements. Under the terms of this agreement, our users will be able to have easy access to email, Internet and corporative applications in the United States using selected cellular telephones, intelligent devices and broadband mobile cards as if they were connected to the local network of Iusacell.
Second Quarter Results
Revenues
Net revenues in the second quarter of 2006 increased by 27% to Ps $1,852 million, as compared to Ps $1,460 million during the same period 2005. The increase is primarily a result of growth in postpaid revenues as well as higher revenues from value added services mainly attributable to an increase in the subscriber base. Grupo Iusacell ended the second quarter of 2006 with 2.0 million subscribers.
Cost and Expenses
During the second quarter of 2006, total cost, increased by 46% to Ps $1,115 million as compared to Ps $763 million in the second quarter 2005. Operating expenses increased by 12% to Ps $437 million, as compared to Ps $389 million in the same period 2005.
The increase in the total cost during the second quarter 2006 mainly reflects the increase in: (i) handset subsidy, (ii) the costs related to value added services and interconnection costs as a result of the increase in air time traffic and subscribers, (iii) technical expenses, and (iv) concessions rights.
The increase in operating expenses during the second quarter 2006 mainly reflects an increase in administrative expenses owing to the creation of regional sales and customer care structures, offset by the reduction in advertising expenses.
Operating Income Before Depreciation and Amortization
Iusacell's operating income before depreciation and amortization for the second quarter of 2006 was Ps $300 million, a decrease of 3% as compared to Ps $308 million during the same period the year before.
Net Income
Iusacell registered a net loss of Ps $867 million for the second quarter of 2006, compared to a net loss of Ps $34 million during the same period in 2005. This loss is mainly a result of an increase in integral financing costs affected mainly by the exchange loss derived from the increase in exchange rates of the peso against the dollar.
CAPEX
During the second quarter of 2006, the Company made investments of approximately US $17 million, mainly for the acquisition of cellular equipment related to the expansion of coverage and capacity of Iusacell's 3-G network and EV-DO services (Evolution Data Only).
Debt
The Company continues with its debt restructuring process as announced through various press releases to date. In this respect and in furtherance of the debt restructuring process, the Company has commenced various proceedings for the legal implementation of the agreements reached with majority of its creditors, which we expect to be accomplished shortly.
About Iusacell
Grupo Iusacell, S.A. de C.V. (BMV: CEL) (Iusacell) is a wireless cellular and PCS service provider in Mexico with a national footprint. Iusacell offers more and better voice communication and data services through state-of-the-art technology, such as its new 3G network, throughout all of the regions in which it operates. In addition to our core mobile telephony services, we also provide a wide range of other telecommunications services, including long distance, wireless local telephony and data transmission services. Additional information is available at http://www.iusacell.com/
Legal Disclaimer
Grupo Iusacell, S.A. de C.V. quarterly reports and all other written materials may from time to time contain statements about expected future events and financial results that are forward-looking and subject to risks and uncertainties. For those statements, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. A discussion of factors that may affect future results is contained in our filings with the Securities and Exchange Commission.
Attached are the Consolidated Income Statements of each of Grupo Iusacell, S.A. de C.V. and Grupo Iusacell Celular, S.A. de C.V. for the three-month and six-month periods ended June 30, 2006, and the Consolidated Balance Sheet of Grupo Iusacell, S.A. de C.V. and Grupo Iusacell Celular, S.A. de C.V. at June 30, 2006.
GRUPO IUSACELL, S.A. DE C.V. AND SUBSIDIARIES MILLIONS OF
MEXICAN PESOS OF JUNE 30, 2006 PURCHASING POWER
(UNAUDITED FIGURES)
QUARTERLY INCOME STATEMENT
2Q05 2Q06 Change
Gross Revenues 107% 1,560 105% 1,947 387 25%
Commissions (7%) (100) (5%) (95) 5 5%
Net Revenues 100% 1,460 100% 1,852 392 27%
Cost of services 42% 620 43% 793 173 28%
Handset Subsidy 10% 143 17% 323 180 126%
Total Cost 52% 763 60% 1,115 353 46%
Gross Profit 48% 698 40% 737 39 6%
Operating Expenses 27% 389 24% 437 48 12%
Depreciation and
Amortization 27% 398 20% 379 (19) (5%)
Total Expenses 54% 787 44% 816 30 4%
Operating Loss (6%) (89) (4%) (79) 10 11%
Operating Profit before
Depreciation and
Amortization 21% 308 16% 300 (9) (3%)
Loss from sale of fixed
assets and other
expenses 1% 10 1% 11 2 19%
Comprehensive Financing
Cost
Interest Expense -
Net (19%) (283) (17%) (310) (27) (9%)
Exchange gain (loss) 29% 425 (23%) (430) (856) (201%)
Gain from net
monetary position (3%) (49) (3%) (59) (10) (20%)
6% 93 (43%) (800) (892) (n.m.)
Loss before taxes 1% 13 (47%) (868) (881) (n.m.)
Tax Provisions (3%) (44) (0%) (1) 43 97%
Equity in income (loss)
of subsidiaries 0% -- 0% 0 0 n.m.
Minority interest (0%) (3) 0% 2 5 180%
Net loss (2%) (34) (47%) (867) (833) (n.m.)
GRUPO IUSACELL, S.A. DE C.V. AND SUBSIDIARIES MILLIONS
OF MEXICAN PESOS OF JUNE 30, 2006 PURCHASING POWER
(UNAUDITED FIGURES)
ACCUMULATED INCOME STATEMENT
6M05 6M06 Change
Gross Revenues 107% 3,035 106% 3,859 824 27%
Commissions (7%) (204) (6%) (206) (2) (1%)
Net Revenues 100% 2,831 100% 3,653 822 29%
Cost of services 43% 1,219 43% 1,576 357 29%
Handset Subsidy 8% 221 17% 634 412 186%
Total Cost 51% 1,440 60% 2,210 769 53%
Gross Profit 49% 1,391 40% 1,443 53 4%
Operating Expenses 29% 808 24% 870 62 8%
Depreciation and
Amortization 28% 793 21% 774 (19) (2%)
Total Expenses 57% 1,601 45% 1,644 43 3%
Operating Loss (7%) (211) (5%) (201) 10 5%
Operating Profit before
Depreciation and
Amortization 21% 583 16% 573 (9) (2%)
Loss from sale of fixed
assets and other
expenses (1%) (24) 5% 165 189 n.m.
Comprehensive Financing
Cost
Interest Expense -
Net (20%) (556) (16%) (594) (38) (7%)
Exchange gain (loss) 14% 405 (21%) (755) (1,160) (287%)
Gain from net
monetary position 1% 36 1% 27 (9) (24%)
(4%) (115) (36%) (1,321) (1,207) (n.m.)
Loss before taxes (24%) (349) (37%) (1,357) (1,008) (288%)
Tax Provisions (2%) (58) (0%) (1) 57 98%
Equity in income (loss)
of subsidiaries 0% -- (0%) (0) (0) (n.m.)
Minority interest (0%) (1) 0% 3 5 n.m.
Net loss (14%) (409) (37%) (1,355) (946) (231%)
GRUPO IUSACELL, S.A. DE C.V. AND SUBSIDIARIES MILLIONS OF
MEXICAN PESOS OF JUNE 30, 2006 PURCHASING POWER
(UNAUDITED FIGURES)
2Q05 2Q06 Change
Cash and cash
equivalents 4 0% 31 0% 27 n.m.
Customers 389 4% 465 4% 76 19%
Due from related
parties 96 1% 310 3% 214 224%
Advanced payments and
other receivables 314 3% 249 2% (65) (21%)
Unamortized handset
subsidy 275 3% 441 4% 166 60%
Inventories 100 1% 42 0% (58) (58%)
Current assets 1,177 11% 1,536 14% 359 31%
Fixed assets 6,696 62% 5,843 53% (852) (13%)
Goodwill - Net 1,857 17% 1,862 17% 4 0%
Other assets 1,100 10% 1,772 16% 673 61%
Total assets 10,829 100% 11,013 100% 184 2%
Short-term debt 8,773 81% 8,945 81% 172 2%
Accrued interest 2,022 19% 2,900 26% 878 43%
Short-term liabilities
with financial cost 10,795 100% 11,845 108% 1,050 10%
Suppliers 284 3% 436 4% 152 54%
Related parties 220 2% 220 2% 0 0%
Unaccrued air time 165 2% 63 1% (102) (62%)
Accumulated expenses
and other payables 949 9% 1,012 9% 64 7%
Short-term liabilities
without financial
cost 1,617 15% 1,731 16% 114 7%
SHORT-TERM LIABILITIES 12,412 115% 13,576 123% 1,164 9%
LONG-TERM LIABILITIES 25 0% -- 0% (25) (100%)
Advances from
customers -- 878 8% 878 100%
STOCKHOLDERS' EQUITY (1,608) (15%) (3,441) (31%) (1,833) (114%)
LIABILITIES + EQUITY 10,829 100% 11,013 100% 184 2%
GRUPO IUSACELL CELULAR, S.A. DE C.V. AND SUBSIDIARIES FIGURES
IN MILLION OF CONSTANT JUNE 30, 2006 PESOS
INCOME STATEMENT
2Q05 2Q06 Change
Revenue 107% 1,623 105% 2,021 399 25%
Commissions (7%) (100) (5%) (95) 5 5%
Net
Revenue 100% 1,523 100% 1,927 404 27%
Cost of services 41% 629 45% 863 235 37%
Handsets subsidy 9% 143 17% 323 180 n.m.
Total Cost 51% 772 62% 1,186 414 54%
Gross Profit 49% 751 38% 741 (10) (1%)
Operating
expenses 25% 382 22% 427 46 12%
Depreciation and
amortization 24% 359 18% 341 (18) (5%)
Total Expenses 49% 741 40% 769 28 4%
Operating Loss 1% 10 (1%) (28) (38) n.m.
EBITDA 24% 369 16% 313 (56) 15%
(Profit) loss
from fixed
assets sales 1% 10 0% 7 (2) n.m.
Integral
Financing Cost
Interest
expense, net (8%) (124) (8%) (156) (33) (27%)
Foreign exchange
loss (gain) 14% 208 (10%) (200) (408) n.m.
Gain from
monetary
position (1%) (15) (1%) (26) (11) (75%)
5% 70 (20%) (382) (452) n.m.
Loss Before Taxes 6% 90 (21%) (402) (492) n.m.
Taxes (3%) (44) (6%) (111) (67) n.m.
Equity
participation in
net loss (income)
of subsidiaries 0% -- 0% -- -- n.a.
Extraordinary
item 0% -- 0% -- -- n.a.
Minority
interest (0%) (3) 0% 2 5 180%
Net Profit
(Loss) 3% 43 (27%) (511) (554) n.a.
GRUPO IUSACELL CELULAR, S.A. DE C.V. AND SUBSIDIARIES
FIGURES IN MILLION OF CONSTANT JUNE 30, 2006 PESOS
INCOME STATEMENT
6M05 6M06 Change
Revenue 107% 3,121 105% 3,999 878 28%
Commissions (7%) (204) (5%) (206) (2) (1%)
Net Revenue 100% 2,917 100% 3,793 876 30%
Cost of services 47% 1,372 45% 1,701 329 24%
Handsets subsidy 8% 221 17% 634 412 186%
Total Cost 55% 1,593 62% 2,335 741 47%
Gross Profit 45% 1,323 38% 1,459 135 10%
Operating expenses 27% 795 22% 852 56 7%
Depreciation and
amortization 25% 718 18% 698 (19) (3%)
Total Expenses 52% 1,513 41% 1,550 37 2%
Operating Loss (6%) (189) (2%) (91) 98 52%
EBITDA 18% 528 16% 607 79 15%
(Profit) loss from
fixed assets sales (1%) (24) 4% 162 186 n.m.
Integral
Financing Cost
Interest expense,
net (8%) (237) (8%) (296) (59) (25%)
Foreign exchange
loss (gain) 7% 198 (9%) (356) (555) n.m.
Gain from
monetary
position 1% 21 0% 12 (9) (43%)
(1%) (17) (17%) (640) (623) n.m.
Loss Before
Taxes (8%) (230) (15%) (570) (339) (147%)
Taxes (2%) (58) (3%) (111) (53) n.m.
Equity
participation
in net loss
(income) of
subsidiaries 0% -- 0% -- -- n.a.
Extraordinary
item 0% -- 0% -- -- n.a.
Minority interest (0%) (1) 0% 3 5 n.m.
Net Loss (10%) (289) (18%) (677) (388) (134%)
GRUPO IUSACELL CELULAR, S.A. DE C.V. AND SUBSIDIARIES
FIGURES IN MILLION OF CONSTANT JUNE 30, 2006 PESOS
6M05 6M06 Change
Cash and marketable
securities 3 0% 11 0% 9 n.a.
Accounts receivable,
net 388 4% 467 5% 79 20%
Unamortized handset
subsidy 275 3% 441 4% 166 60%
Related parties 347 4% 705 7% 358 103%
Recoverable taxes
and other 260 3% 207 2% (53) (20%)
Inventories 100 1% 42 0% (58) (58%)
TOTAL CURRENT
ASSETS 1,371 14% 1,872 19% 501 37%
Property and
equipment, net 6,164 64% 5,226 53% (938) (15%)
Excess of cost of
investments in
subsidiaries over
book value, net 1,672 17% 1,672 17% (0) (0%)
Other assets 435 5% 1,152 12% 716 165%
TOTAL ASSETS 9,641 100% 9,920 100% 279 3%
Short-term debt 4,602 48% 4,692 47% 90 2%
Accrued interest 466 5% 713 7% 247 53%
Short-term
liabilities with
financial cost 5,068 53% 5,405 54% 337 7%
Accrued
liabilities 718 7% 593 6% (125) (17%)
Related parties 221 2% 699 7% 478 217%
Accounts payable 256 3% 129 1% (127) (50%)
Unaccrued air time 165 2% 63 1% (102) (62%)
Short-term
liabilities
without
financial cost 1,360 14% 1,484 15% 124 9%
SHORT-TERM
LIABILITIES 6,428 67% 6,890 69% 462 7%
LONG-TERM
LIABILITIES 0 0% -- 0% (0) (100%)
Advances from
customers 878 9% 878 n.a.
Minority interest (81) (1%) (74) (1%) 7 (9%)
TOTAL SHAREHOLDERS'
EQUITY 3,294 34% 2,226 22% (1,067) (32%)
TOTAL
LIABILITIES AND
SHAREHOLDERS'
EQUITY 9,641 100% 9,920 100% 279 3%
