Telefônica Brasil announces its results for 2Q24

Rhea-AI Summary

Telefônica Brasil (B3: VIVT3; NYSE: VIV) reported strong 2Q24 results with above-inflation growth in revenues, EBITDA, and net income. Key highlights include:

- Net Operating Revenue: R$13,679 million (+7.4% YoY)
- EBITDA: R$5,455 million (+7.3% YoY)
- Net Income: R$1,222 million (+8.9% YoY)
- Earnings per Share: R$0.74 (+9.5% YoY)

Growth was driven by strong performance in Mobile Service Revenue (+8.8% YoY) and FTTH Revenue (+17.1% YoY). The company's FTTH network now covers 444 cities with 27.3 million homes passed. Telefônica Brasil has committed to distribute at least 100% of net income as shareholder remuneration for 2024-2026.

Positive

• Net Operating Revenue increased by 7.4% YoY to R$13,679 million
• EBITDA grew by 7.3% YoY to R$5,455 million
• Net Income rose by 8.9% YoY to R$1,222 million
• Mobile Service Revenue increased by 8.8% YoY
• FTTH Revenue grew by 17.1% YoY
• Postpaid customer base increased by 7.2% YoY
• FTTH network expanded to 444 cities, with 27.3 million homes passed (+10.5% YoY)
• Operating Cash Flow increased by 14.0% YoY to R$3,114 million
• Company committed to distribute at least 100% of net income as shareholder remuneration for 2024-2026

Negative

• Other Revenues decreased by 15.3% YoY
• Total Costs increased by 7.5% YoY to R$8,224 million
• EBITDA margin slightly decreased by 0.1 percentage point YoY to 39.9%
• Free Cash Flow for 6M24 decreased by 3.0% compared to 6M23

SÃO PAULO, July 29, 2024 /PRNewswire/ -- Telefônica Brasil - (B3: VIVT3; NYSE: VIV), announces its results for 2Q24.

2Q24 Results: Telefônica Brasil S.A.

Strong operating performance leading to above-inflation growth in revenues, EBITDA and net income.

R$ million	2Q24	2Q23	% Y-o-Y	6M24	6M23	% Y-o-Y
Net Operating Revenue	13,679	12,733	7.4	27,225	25,454	7.0
Mobile Services	8,907	8,184	8.8	17,609	16,149	9.0
FTTH	1,757	1,501	17.1	3,474	2,997	15.9
Corporate Data, ICT and others	1,128	1,042	8.3	2,260	2,135	5.9
Electronics	817	743	9.9	1,698	1,597	6.3
Other Revenues¹	1,070	1,263	(15.3)	2,184	2,575	(15.2)
Total Costs	(8,224)	(7,648)	7.5	(16,493)	(15,426)	6.9
EBITDA	5,455	5,085	7.3	10,732	10,027	7.0
EBITDA / Net Revenue Margin	39.9 %	39.9 %	(0.1) p.p.	39.4 %	39.4 %	0.0 p.p.
EBITDA AL	4,216	3,927	7.3	8,263	7,711	7.2
EBITDA AL / Net Revenue Margin	30.8 %	30.8 %	(0.0) p.p.	30.4 %	30.3 %	0.1 p.p.
Net Income	1,222	1,123	8.9	2,118	1,957	8.2
Earnings per Share (EPS)	0.74	0.68	9.5	1.28	1.18	8.8
CAPEX ex-IFRS 16	2,341	2,353	(0.5)	4,215	4,039	4.4
Operating Cash Flow (OpCF)	3,114	2,732	14.0	6,517	5,988	8.8
OpCF/ Net Revenue Margin	22.8 %	21.5 %	1.3 p.p.	23.9 %	23.5 %	0.4 p.p.
Operating Cash Flow AL (OpCF AL)	1,875	1,575	19.1	4,048	3,672	10.2
OpCF AL / Net Revenue Margin	13.7 %	12.4 %	1.3 p.p.	14.9 %	14.4 %	0.4 p.p.
Free Cash Flow	3,089	2,508	23.1	5,469	5,638	(3.0)
Total Subscribers (Thousand)	114,683	111,940	2.5	114,683	111,940	2.5

^{1 – Other Revenues includes Voice, xDSL, FTTC and IPTV.}

Net revenue grew (+7.4% YoY), driven by the strong performance of Mobile Service Revenue (MSR) (+8.8 YoY), which was boosted by the growth of Postpaid Revenue (+9.7% YoY). Postpaid's strong performance is related to the increase in customer base (+7.2% YoY), both due to migrations from prepaid as well as to the acquisition of new customers, annual price adjustments, and by maintaining postpaid's (ex-M2M) churn in historical low levels, 0.99% per month.

Fixed revenue had the biggest increase since 2015, +3.9% YoY, mainly driven by the increase in FTTH Revenue, which continued to expand strongly (+17.1% YoY) in 2Q24. FTTH network is currently present in 444 cities (+5 cities YoY) with 27.3 million homes passed (+10.5% YoY) and 6.5 million homes connected (+12.7% YoY).

EBITDA totaled R$5,455 million (+7.3% YoY), with a margin of 39.9% (-0.1 p.p. YoY), due to the strong service revenue performance.

Operating Cash Flow totaled R$3,114 million (+14.0% YoY), with a margin of 22.8% (+1.3 p.p. YoY) over net revenue. In 2Q24, Capex ex-IFRS16 totaled R$2,341 million (-0.5% YoY) or 17.1% of revenues (-1.4 p.p. YoY), directed towards strengthening our mobile network.

Net income attributed to Telefônica Brasil reached R$1,222 million in 2Q24 (+8.9% YoY). Shareholder remuneration paid up in 2024 reached, so far, R$4,137 million, of which R$2,190 million in interest of capital, R$1,500 million from the resources resulting from the capital reduction, while R$447 million were invested in share buybacks. For the years 2024 to 2026, the Company has committed to distribute an amount equal to or above 100% of net income for each fiscal year.

To download the complete version of the Company's earnings release, please visit our website: https://ri.telefonica.com.br/en 

View original content:https://www.prnewswire.com/news-releases/telefonica-brasil-announces-its-results-for-2q24-302209110.html

SOURCE Telefônica Brasil S.A.

FAQ

What was Telefônica Brasil's (VIV) net operating revenue in Q2 2024?

Telefônica Brasil's net operating revenue in Q2 2024 was R$13,679 million, representing a 7.4% increase year-over-year.

How much did Telefônica Brasil's (VIV) FTTH revenue grow in Q2 2024?

Telefônica Brasil's FTTH revenue grew by 17.1% year-over-year in Q2 2024.

What was Telefônica Brasil's (VIV) net income in the second quarter of 2024?

Telefônica Brasil's net income in Q2 2024 was R$1,222 million, an 8.9% increase compared to the same period in 2023.

How many cities does Telefônica Brasil's (VIV) FTTH network cover as of Q2 2024?

As of Q2 2024, Telefônica Brasil's FTTH network covers 444 cities, an increase of 5 cities year-over-year.

What is Telefônica Brasil's (VIV) shareholder remuneration policy for 2024-2026?

Telefônica Brasil has committed to distribute an amount equal to or above 100% of net income as shareholder remuneration for each fiscal year from 2024 to 2026.