08/06/07


Cellular leaders 2Q07. What changes with Telemig/Amaz sale?

 

Teleco has been checking since 1st quarter 2007 (1Q07) the cellular leaders in Brazil according to 7 indicators (more details). The following table presents the selected indicators and leaders in the 1Q07 and 2Q07.

 

 

Leader in
Indicator
Leader
1Q07
Leader
2Q07
Cellulars
Market Share
Vivo
Vivo
Growth
Net Adds
Tim
Claro
Revenue
Net Revenue
Vivo
Tim
Revenue per client
ARPU
Tim
Tim
Income
EBITDA Margin
Telemig/
Amaz
Telemig/
Amaz
Coverage
Population attended
Tim
Tim
Quality
Anatel goals
Telemig/
Amaz
Telemig/
Amaz and Oi

Note: CTBC and Sercomtel weren't included.

 

According to these indicators cellular leadership in Brazil 2Q07:

 

 

 

Vivo announced on 08/5/07 the acquisition of Telemig/Amazônia. If this acquisition didn't happen in the 2Q06 Vivo wouldn't lose revenue leadership to Tim and Oi would be leader in earning and quality in the quarter.

 

Cell Phone quantity: Market Share and Growth

 

Vivo continues being the bigger cell phone operator of Brazil with 30.2 million cellulars and market share of 28.35%. It leads market share in 2 Regions, 11 States (UF) and 27 of the 67 local areas (DDD). (More details)

 

2Q07
Market
Share
Cellulars
(thousands)
Market Share Leader
Region
State
Local Area
Vivo
28.35%
30,241
II and III
11
27
Tim
25.78%
27,493
I
7
20
Claro
24.61%
26,252
-
3
7
Oi
12.78%
13,634
-
4
9
Telemig/Amaz
4.53%
4,837
-
2
4
BrT
3.53%
3,769
-
-
-

 

The main change comparing to the 1Q07 was Oi which lost leadership in Region I to Tim.

 

With Telemig/Amazônia joint venture, Vivo would have:

  • 35,077 thousand cellulars and market share 32.89%, increasing the difference to Tim and Claro.
  • take 2nd position in market share Region I, exceeding Oi.
  • Leader in 15 States and (UF) 33 of the 67 areas of DDD ( local areas).

The joint venture wouldn't be enough for Vivo to exceed Claro in growth.

 

Claro is the leadership in net adds on this quarter and also in the accumulated of the year, reducing its leadership comparing to Tim to 1.2 million cellulars. Was also the operator with more percentage growth (6.7%) in the quarter.

 

 

 

Vivo grew in the 2Q07 with net adds superior to Tim.

 

 

Revenue and ARPU

 

Tim was leader in net revenue 2Q07.

 

R$ Thousands
1Q07
2Q07
Revenue Share
Vivo
2,851
3,021
29.0%
Tim
2,843
3,060
29.3%
Claro
2,155
2,431
23.3%
Oi Celular
1,000
1,028
9.9%
Telemig/Amaz
432
461
4.4%
BrT
385
429
4.1%

 

Vivo kept gross revenue leadership with R$ 4,310 mn against R$ 4,216 mn of Tim.

 

Tim's leadership is because of the best ARPU gotten.

 

R$
1Q07
2Q07
TIM
34,4
34,6
BrT
33,4
33,8
Vivo
30,0
29,9
ARPU Brasil
29,3
29,4
Telemig
27,6
29,2
Amaz Cel
28,4
28,9
Claro
27,0
27,0
Oi
21,6
21,5

 

 

 

With Telemig/Amazônia joint venture Vivo would be leader in revenue but would keep 3rd position in ARPU.

 

 

 

 

Earning

 

Telemig/Amazônia Celular was leader in earning 2Q07, with EBITDA margin and EBIT superior to the other. Telemig/Amazônia Celular, Tim and Oi Celular presented good profit in the quarter.

 

 

2Q07
EBITDA Margin
EBIT Margin
Profit*
Telemig/Amaz
34.0%
17.3%
43
Oi
25.9%
8.4%
102
Claro
24.7%
7.2%
ND
TIM
24.3%
5.7%
34
Vivo
21.0%
1.1%
-112
BrT GSM
1.2%
-21.0%
-48

*R$ Millions

 

 

 

Telemig/Amazônia and Vivo joint venture would rise EBITDA margin in 22.7%. Oi would lead profit 2Q07.

 

The results of 2Q07 indicate that operators are getting good earning in 2007. EBITDA margin average increased from 15.4% in the 2Q06 to 23.1% in 2Q07.

 

Coverage and Quality

 

Tim, only operator that operates in all States in Brazil, is the leader in population and attended cities.

 

Operator
Population
Cities
Tim
86%
44%
Claro
78%
42%
Vivo
67%
41%
Oi
39%
15%
Brasil Telecom
21%
14%
Telemig/Amaz
15%
9%

 

 

With Telemig/Amazônia / Vivo joint venture, Vivo would have coverage in Minas Gerais, missing only Northeast States (area 8) to reach national coverage. Vivo would lead in coverage cities (48%), but would continue 3rd in population attended (76%).

 

Telemig/Amazônia Celular was leader in quality attendance 2Q07.

 

Attended Goals
1Q07
2Q07
Telemig/Amaz
98.0%
100%
Oi
79.5%
100%
Vivo
91.0%
97.2%
Brasil
94.3%
96.5%
Tim
97.9%
95.9%
Claro
92.3%
95.1%
BrT GSM
96.0%
94.4%

 

Oi and Telemig/Amazônia celular, attended 100% of the quality goals in 2Q07. Telemig/Amaz attended 99% of the goals and Oi 91.8% (more details).

 

You could ask:

  • Who leads cellular in Brazil?
  • What changes with Telemig/Amazônia acquisition by Vivo? Will Tim continue be leadership in revenue?
  • Will Claro exceed Tim in market share?
  • After Telemig/ Amazônia acquisition approval the joint venture of VIVO/ Tim would be approved?

 

Comment.

 

To send us a commentary, click on: teleco@teleco.com.br

 

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