Millicom cable RGUs up 94,000 in 3Q 2016Tuesday, October 25th, 2016
HFC network expanded by 180,000 homes passed; total cable homes passed of 7.915 million
LUXEMBOURG — Millicom has announced results for the quarter ended September 30, 2016.
Millicom is undertaking a major reconfiguration of its operations in Latin America, to enable us to build a strong, sustainable digital telecoms business in the region, capable of delivering a superior experience for customers and growing long-term value for shareholders. This means building out both our cable and 4G mobile networks and monetising these investments as rapidly as possible, seizing the opportunity we see across consumer and business markets by delivering the data services that customers now demand.
Our cable build out in Latam remains well on track. The total HFC homes passed in the third quarter increased by 180,000, maintaining our recent roll-out run-rate, and including conversion of 54,000 copper homes. The cable network comprised a total of 7.915 million homes passed at the end of the quarter, already very close to our year-end target of 8 million.
The increase in the HFC homes passed was significantly higher than the total homes passed, reflecting the rolling out of HFC over areas served by our legacy copper networks. This is an important component of our strategy, as these are areas where we have existing customers whom we can retain by migrating them onto our new network, and to whom we can therefore offer higher value packages, generating higher ARPU. At the end of the quarter our HFC network passed 6.848 million homes, 671,000 more than at the same time last year.
Penetration rates in the quarter remained on track and at the end of the quarter the number of residential HFC RGUs was 534,000 higher than at the same time in 2015, with the ratio of RGUs per HFC home connected continuing to grow in line with recent trends, reflecting the increasing penetration of double and triple-play packages bought by households. Residential cable ARPU grew by 3.7% organically in the quarter.
Cable KPIs (thousands):
Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 ----- ----- ----- ----- ----- ----- ----- ----- Homes connected Latin America 2,881 2,915 2,962 2,962 3,020 3,021 3,017 3,071 South America 2,113 2,116 2,138 2,093 2,098 2,074 2,055 2,071 Central America 768 798 824 869 922 947 962 1,000 RGUs Latin America 5,090 5,178 5,239 5,251 5,393 5,424 5,465 5,559 South America 3,966 3,997 4,020 3,977 4,050 4,035 4,049 4,097 Central America 1,125 1,181 1,218 1,274 1,344 1,388 1,416 1,462 HFC RGUs Latin America 2,773 2,888 2,938 3,073 3,244 3,361 3,471 3,607 South America 1,746 1,835 1,870 1,971 2,095 2,185 2,285 2,394 Central America 1,027 1,052 1,069 1,102 1,150 1,177 1,186 1,212
Cable revenue continued to grow in the quarter, as we maintained the roll-out of our network. Customer connections included a substantial number of existing copper customers migrating to HFC as their homes were passed, as well as customers new to TigoUne. The growth in the number of double and triple-play customers continued, and we aim to keep up this momentum, including starting to offer Netflix in October to customers on triple-play plans.
The cable network build out continued on track, with network penetration and higher RGU delivering strong cable revenue growth.
Mobile data growth remained solid and cable revenue was strong, with a positive response to the introduction of our Netflix-based promotion in the quarter delivering higher HFC RGUs.
Our cable business in Costa Rica continued to perform well in the quarter, with service revenue growing by 4.7% to $38 million.