TIM Brasil Q1 profit plummets 60%, replaces CEO

TIM Brasil has replaced its CEO Rodrigo Abreu with Stefano De Angelis after reporting first quarter net income down 59.7 percent to BRL 127.9 million compared to BRL 317.4 million a year earlier. Describing the first three months of the year as a “tough” quarter, the Brazilian operator also reported net revenues down 15.3 percent to BRL 3.85 billion compared to BRL 4.55 billion a year earlier, with a 14.3 percent rise in fixed failing to offset a 9.2 percent decline in mobile. EBITDA fell 16.6 percent to BRL 1.121 billion, affected by a number of factors, including Brazil’s worst recession in decades, costs to reduce personnel and provisions for customers’ unpaid accounts, which rose 26 percent year on year. However, ARPU was up 3 percent year on year, confirming the positive trend started in the previous quarter.

The customer base reached 67.3 million at the end of March, down 11.2 percent year on year, of which 53.7 million were pre-paid (-14.4%) and 13.54 million post-paid (+4.1%). The number of 4G customers passed 9 million at the end of the quarter, accounting for nearly 14 percent of total subscribers. TIM remained the market leader in terms of 4G coverage, expanding its network to 439 cities or 60 percent of Brazil’s urban population by the end of the quarter. However, Capex declined 23.1 percent year on year to BRL 710 million, attributed to tougher and longer negotiations with network equipment vendors.

In a separate statement, TIM Brasil confirmed that its board of directors had appointed Stefano De Angelis as its new CEO, replacing Rodrigo Abreu, who has been at the helm for three years. The confirmation comes after Giuseppe Recchi, chairman of controlling shareholder Telecom Italia said last month the board was considering management changes at TIM “as you do when a company enters a turnaround phase.” De Angelis has been at Telecom Italia since 1997 and is currently head of the company’s consumer business unit.

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