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Millicom reports 15% revenue growth for 2014

Tigo Bolivia

Emerging markets-focused operator and media service group Millicom has reported its 2014 financial results showing 14.9% revenue growth for the year, largely attributed to its expansion across the Latin American market.

The company, which operates telecoms, satellite pay TV and cable services, derived large part of the revenue growth from the merger with Colombia’s UNE. The group also said its ‘digital lifestyle strategy’, began in 2012, has delivered results as the firm has launched services to create an ecosystem of digital services including music, shopping and finance.

Total group revenues reached $6.4 billion, up 14.9% year-on-year, while quarter four revenues increased 27% compared to the same time previous year to $1.8 billion. Revenues in Latin America grew by 13% to $5.4 billion, and the number of mobile subscribers in the region hit a new record at 30 million.

In Q4 2014, Millicom’s mobile service revenue grew by 4%, and number of subscribers increased by 2.3 million (including 244,000 from the UNE acquisition). Mobile data users increased in Q4 by 1.9 million, of which 700,000 net additions in Africa and 1.2 million in Latin America.

Last year the company launched its pay TV services, Tigo Star and Tigo Sports in the LatAm region, as well as Tigo Music streaming service, which also launched in Africa last month. The number of households subscribing to the pay TV services in the countries it is now available- El Salvador, Costa Rica, Honduras, Guatemala and Bolivia- reached 85,000.

“2014 was a year of transformation and rapid progress in executing the digital lifestyle strategy but trading conditions in emerging markets weakened in the fourth quarter,” Tim Pennington, Millicom’s Interim CEO said. We saw currencies decline in a number of our countries, particularly Colombia. Despite this, we delivered a strong Q4, with revenue growing at an underlying rate of 10.8% – the highest quarterly rate in the year.”

Revenues from the Tigo Money mobile financial services, available in the LatAm markets of El Salvador, Guatemala, Paraguay and Honduras, grew 47% in South America and 28% in Central America.

“This growth is a direct result of the digital lifestyle strategy we began in 2012 and the last quarter has been the most successful to date. Smartphone sales in Q4 exceeded 1.6 million, a further 1.5 million customers became users of our mobile financial services and we surpassed five million revenue generating units in our cable business in Latin America,” Pennington said.

However, while Q4 mobile ARPU in Central America was flat year-on-year, in South America it decreased 3% at constant exchange rate, which the company said was mainly due to the termination rate in Paraguay.

In Africa the Sweden-based company’s mobile customer base grew by 24% to 25.3 million in 2014, and total revenues came to $1 billion. The telco claimed mobile money customers in the continent increased by 50% to 6.1 million and that one in five now take a data package as part of their mobile subscription.Q4 mobile ARPU in the African region increased 11% year-on-year.


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