April 25, 2018 / 11:28 AM / a year ago

UPDATE 1-Telefonica Brasil posts higher 1st-qtr profit but misses consensus

(Adds details throughout on EBITDA, average revenue per user, costs, company strategy)

April 25 (Reuters) - Telefonica Brasil SA on Wednesday posted higher first-quarter profit but still missed estimates as Brazil’s largest telecommunications company continued to make progress in its data and high-end mobile segments.

The company reported net income of 1.098 billion reais ($316 million), a 10.2 percent jump from the same period a year before, but below the Reuters consensus estimate of 1.18 billion reais.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) came in at 3.77 billion reais, slightly above the Reuters consensus estimate of 3.71 billion reais.

Vivo, as Telefonica SA’s Brazil unit is locally known, continued a recent pattern of moving mobile customers from relatively downscale prepaid plans to more upscale postpaid plans, which helped margins. Postpaid connections jumped 10.9 percent from the year before, while prepaid fell 6.4 percent.

The company expanded its fiber-to-home high-speed broadband network, increasing connections by 47 percent in annual terms.

That helped average revenue per user (ARPU) climb by healthy margins in the broadband and data segments, though an ARPU decrease in the company’s voice segment held back gains.

Total operational costs fell 1.2 percent from the same period a year before. But a noticeable increase in some segments, such personnel, limited overall savings. ($1 = 3.47 reais) (Reporting by Gram Slattery and Bruno Federowski; Editing by Jason Neely and Jeffrey Benkoe)

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