May 14, 2019 / 2:29 PM / 4 months ago

Oi to invest 7 billion reais per year, focus on FTTH broadband service: CFO

SAO PAULO (Reuters) - Brazilian telecommunications firm Oi plans to spend 7 billion reais ($1.76 billion) in capital expenditures per year until 2020, focusing mostly in the expansion of its high-speed fiber-to-the-home (FTTH) broadband service, Chief Financial Officer Carlos Brandão, said on Tuesday.

“Our capex plan is fully funded in the first year and we have up to 7 billion reais in assets to be monetized in the short-term,” Brandão told analysts in a call to discuss results.

Last year, the company spent 6.1 billion reais in capex.

Brazil’s largest fixed-line firm has hired Bank of America Merrill Lynch to prospect and structure the sale of non-core assets, as part of a broader strategic review likely to be concluded by mid-June, he added.

For now, the acceleration of FTTH network is at the heart of Oi’s strategy. The company currently is able add 250,000 homes per month to its high-speed fiber-to-the-home (FTTH) broadband service this year.

“We are investing heavily to accelerate fiber expansion, as it will be an important driver of value creation in B2B segment,” he said.

In mobile, Oi expects to reverse a declining trend in revenues in the coming quarters, helped mainly by promising results in post-paid segment, while automation and other digital initiatives should further reduce operational expenses, Brandão added.

Oi’s preferential shares were trading 1.3 percent lower at 1.53 reais, after the company reported a net profit of 679 million reais ($170.96 million) amid still shrinking revenues.

Analysts at BTG Pactual said that, although operational results continue to suffer, costs look under control, and maintained a buy rating for the stock.

“We expect to hear positive news on the regulatory front (PLC 79) in the short-term and continue to see Oi as a unique strategic asset for local and foreign players,” they wrote in a report.

In June 2016, Oi filed for Latin America’s largest-ever bankruptcy protection proceeding, to restructure a debt of approximately 65 billion reais, setting off a protracted battle among creditors and shareholders.

A restructuring plan was finally agreed in December 2017 and much of the company’s activities since then have revolved around implementing the terms of the agreement.

Reporting by Gabriela Mello; Editing by Marguerita Choy

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below