Revenue Growth: Increased 27.8% in constant currency from ARS1,066.4 billion to ARS1,363.4 billion. EBITDA: Reached ARS448.6 billion in constant currency, a 39.2% increase compared to Q1 2024. EBITDA Margin: Increased to 32.9% in Q1 2025 from 30.2% in Q1 2024. Net Income: ARS86.8 billion, a decrease from ARS1,050.7 billion in Q1 2024. Mobile Revenue: Increased 42.9% in real terms, driven by the incorporation of TMA and higher ARPUs. Fixed Services Revenue: Increased 14% in real terms, mainly due to the incorporation of TMA. Broadband Subscribers: Remained stable at 4.1 million. CapEx as Percentage of Revenue: 16.2% or 13% before rights of use from leases. Net Debt to EBITDA Ratio: 2.6 times as of March 2025.

Warning! GuruFocus has detected 5 Warning Signs with CVHSY.

Release Date: May 14, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Cablevision Holding SA (CVHSY) reported a significant increase in EBITDA margin to 33.6% in Q1 2025, up from 30.2% in Q1 2024. The acquisition of Telefonica Movil Argentina SA (TMA) is expected to enhance Telecom's capabilities and expand coverage and service quality across Argentina. Revenues in constant currency grew by 27.8% year-over-year, driven by the incorporation of TMA and price increases. The company achieved a net positive income of ARS86.8 billion, despite challenging economic conditions. Mobile service revenues increased by 42.9% in real terms, largely due to the TMA acquisition and higher ARPUs in Argentina.

Negative Points

The commercial balance deteriorated with a $2.2 billion deficit as of March 2025, compared to a $9 billion surplus in the same period last year. Net income decreased significantly from ARS1,050.7 billion in Q1 2024 to ARS86.8 billion in Q1 2025, mainly due to lower positive financial results. Fixed telephony and data services revenues decreased by 20.3%, impacted by a reduction in legacy copper accesses. The company faces challenges from high inflation dynamics and stress from price increases on the subscriber base. Political uncertainty ahead of the middle elections poses a critical test for the government's economic program.

Q & A Highlights

Q: Can you provide an overview of the macroeconomic environment in Argentina and its impact on Cablevision Holding SA? A: Julian Brescia, Senior Analyst, explained that the current administration inherited an economy with significant macroeconomic imbalances, including high inflation and fiscal deficits. The government implemented a stabilization program, resulting in a fiscal surplus and reduced inflation. However, challenges remain, such as political uncertainty and global volatility affecting export prices.

Story Continues

Q: What are the key financial highlights for Cablevision Holding SA in the first quarter of 2025? A: Samantha Olivieri, Investor Relations Officer, reported that revenues in constant currency grew by 27.8%, driven by the acquisition of Telefonica Movil Argentina (TMA) and price increases. EBITDA increased by 39.2%, with a margin of 32.9%. The acquisition of TMA significantly contributed to these results.

Q: How has the acquisition of Telefonica Movil Argentina impacted Cablevision's operations? A: The acquisition has enhanced Telecom Argentina's capabilities, allowing for expanded coverage and improved service quality. TMA's integration contributed to increased revenues and EBITDA, with TMA's operations complementing Telecom's existing network.

Q: What are the main challenges Cablevision is facing in terms of revenue and cost management? A: The company has been managing inflation impacts through effective pricing policies and cost efficiencies. Despite high inflation, Cablevision has managed to increase prices above inflation, resulting in higher real-term revenues. Cost management efforts have also led to a slight decrease in operating costs in real terms.

Q: Can you elaborate on Cablevision's debt position and future financial strategy? A: As of March 2025, Cablevision reported a total financial debt of ARS4,120.7 billion. The debt was primarily used to finance the TMA acquisition. The company maintains a healthy net debt to EBITDA ratio of 2.6 times and plans to access local and international debt markets for future financing needs.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.

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