TEF » Topics » Brazil

This excerpt taken from the TEF 6-K filed May 16, 2007.
Revenues 1,801 1,836 (1.9) 2.8  
  OIBDA 749 764 (1.9) 2.8  
  OIBDA margin 41.6% 41.6% (0.0 p.p.)    
  CapEx 170 144 18.3 23.9  
This excerpt taken from the TEF 6-K filed May 15, 2006.
Revenues 496.8 370.7 34.0
  OIBDA 136.3 141.9 (4.0)
  OIBDA margin 27.4% 38.3% (10.8 p.p.)
This excerpt taken from the TEF 20-F filed Apr 12, 2006.

     Brazil’s estimated GDP growth was 2.3% in 2005 compared to 4.9% in 2004 and 0.5% in 2003. Inflation has been gradually declining, with consumer prices increasing by 5.7% in 2005 compared to 7.6% in 2004 and 9.3% in 2003. In order to curb the inflationary trend and achieve the official government target rate of inflation, the Central Bank of Brazil raised the basic interest rate (Selic) from 16.00% in August 2004 to 19.75% in June 2005. After inflation was reduced to the target rate of inflation (5.1% in 2005), the Central Bank of Brazil began to gradually reduce the Selic rate to 19.50% in September 2005. At March 22, 2006, the Selic rate was 16.5% . Brazil ended 2005 with a record trade balance surplus of US$44.7 billion, compared to U.S.$33.7 billion in 2004. In 2005, exports increased by 23% to US$118.3 billion, while imports increased by 17% to US$73.5 billion.

This excerpt taken from the TEF 6-K filed Mar 1, 2006.
Revenues 1,889.3 1,502.3 25.8
  OIBDA 496.5 491.0 1.1
  OIBDA margin 26.3% 32.7% (6.4 p.p.)
This excerpt taken from the TEF 6-K filed Nov 14, 2005.










OIBDA margin



(6.2 p.p.)

This excerpt taken from the TEF 6-K filed Aug 1, 2005.



The Brazilian market recovered its accelerated pace of growth in the second quarter of 2005, driven by two of the main commercial campaigns in the year: Mothers’ Day in May and Dia dos Namorados (Brazil’s St. Valentine’s Day) in June.


Thus, in comparison to a 9% year-over-year in total net adds in the market to March, year-over-year growth in the second quarter of 2005 stood at 40%. This implies a penetration rate of 41.1% (44.5% in Vivo’s areas of operation), much higher than the 38% in March and 30% in June 04.


In this context of operations, in which all competitors have increased their commercial aggressiveness, with renewed pressure on the contract segment as a clear differential factor vs. year 2004, Vivo continues to focus on high-value customer acquisition and retention, repositioning its top and medium range handsets and increasing the variety of its portfolio. This strategy, coupled with the promotion of prepaid to contract migrations, has led to a continued increase in net adds in the contract segment (with more than 200 thousand customers in the second quarter of 2005 compared to 122 thousand in the first quarter of 2005 and 30 thousand in the second quarter of 2004).


In the prepaid segment, the Company’s efforts to establish more rational competitive conditions in the market by raising entry barriers at periods of lower commercial activity, have not been followed by its competitors, who have even launched more aggressive campaigns.


In the second quarter of 2005, Vivo’s commercial activity showed a marked increase, with net adds in the period close to 1.49 million (3.6 times higher than the first quarter of 2005). At the end of June Vivo’s customer base was 28.45 million (+21% vs. the first semester of 2004), with an estimated average market share in its areas of operation of 47.6%.


As for customer usage, total MOU in the first quarter of 2005 was 79 minutes (90 minutes in the first quarter of 2004), impacted by the performance of incoming MOU. Total ARPU for the quarter stood at 28.6 reais (33.3 reais in the second quarter of 2004)


Regarding Vivo’s financial results, the first semester of 2005 revenues grew 5% year-over-year in local currency, in line with the growth of service revenues (+5%).


The performance of revenues from outgoing traffic continues to be affected, among other factors, by Vivo’s repositioning of prices in the contract segment due to greater pressure on prices from competitors (“right planning”, leading to a significant reduction in ARPM for this segment). On the contrary, we would highlight the positive performance of outgoing service revenues in the prepaid segment.


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