teleco.com.br

08/31/2009

Telefonica, Embratel and GVT presented the highest profitability in the 1st semester of 2009

Telefonica (Telesp), Embratel and GVT were the operators that presented the highest profitability in the 1st semester of 2009 (Jan_Jun09), with net margin (net profit / net revenue) between 12 and 13%.

Oi and TIM presented negative net margin. Oi presented the highest net revenue among all operators in Brazil, but its net margin was affected significantly by the debts gotten from the purchase of BrT and, consequently, the company presented loss in the first semester of 2009.

The following table presents the market cap of theses operators in Jun/09, net revenue in the 1st semester of 2009 and its growth against the same period of the previous year.

1st Sem09	R$ Billions	Market Cap	Net Revenue	Growth 2Q09/2Q08
Mobile	Vivo	13.8	8.0	6.5%
	Tim	10.7	6.3	2.2%
	Claro	-	5.7	4.6%
Fixed	Telefonica	21.8	7.9	1.8%
	Embratel	10.7	5.1	9.6%
	Net	6.9	2.2	26.9%
	GVT	4.2	0.8	27.7%
Mobile and Fixed	Oi	13.0	14.8	0.2%

Note: The companies considered were Vivo Participações (Vivo), Tim Participações (Tim), Telesp (Telefonica), Embratel Participações (Embratel), Net Serviços de Comunicação (Net), GVT (Holding) and Tele Norte Leste Participações - TNLP (Oi), reminding that Oi includes BrT. Claro's information has América Móvil as source.

Telefonica (Telesp)'s good performance in profitability has guaranteed to the company a market cap higher than other companies'. Broadband contributed to the growth superior than 20% presented by Net and GVT in their net revenue.

The box presents small modifications when considered the EBITDA Margin (EIBTDA/Net revenue). The highlight goes to Vivo which presented EBITDA margin superior than 30%, being the first mobile carrier to keep itself in a level above 30%, until then this space was occupied by fixed operators.

Note: EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is gotten from the revenue less the taxes and operational costs.

When considered the effect of depreciation and amortization of investments (Ebit Margin), Oi falls in performance, being surpassed by Embratel and Net.

Oi (TNLP) is the company with the best leverage (Asset/Equity) among the analyzed companies. In fact, Oi's net debt grew from R$ 2.5 billion in 1Q08 to R$ 21.6 billion in 2Q09, including the purchase of BrT.