UNE-Tigo Full-Year 2023 Net Losses Worsen Compared to 2022
Medellin-based cell-phone/internet/telecom giant UNE-Tigo – a joint venture with Spain-based Millicom – announced March 27 a full-year 2023 net loss of COP$$1.14 trillion (US$295 million), more-than-double the COP$474 billion (US$122 million) net loss in 2022.
UNE-Tigo blamed the net losses on “macroeconomic variables due to financial updating and amortization of financial leases under IFRS 16 regulations on contracts indexed to inflation by the Consumer Price Index (CPI) and Producer Price Index (PPI)” as well as “higher amortization and indexation expenses associated with spectrum renewal in our subsidiary Colombia Móvil.”
Other reasons for the net loss included a “negative impact, especially in the first half of 2023, to the effect of devaluation of the [COP/U.S. dollar] exchange rate on investments, which imply greater asset accounting depreciation expense,” as well as “increase in the financial borrowing costs of our debt issues bonds and external debt whose settlement is tied to the performance of inflation (CPI) and Reference Banking Indicator (IBR), respectively,” according to the company.
Despite the net loss, full-year 2023 gross revenues rose by COP$22 billion (US$5.7 million) year-on-year, to COP$5.46 trillion (US$1.4 billion), while earnings before interest, taxes, depreciation and amortization (EBITDA) rose 6.2% year-on-year, to COP$1.74 trillion (US$450 million), according to the company.
The boost in revenues “was the result of our commercial efforts aimed at increasing the average revenue per customer and at the same time growing the subscriber base in the mobile [cell-phone] business — mitigating the effects of the reduction in income derived from the decrease in interconnection rates — and an increase in digital businesses for cloud services, cybersecurity, datacenters, among others, in the business and government segments,” according to UNE-Tigo.
