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UPDATE 2-Mexico America Movil profit surges on forex gains
April 25, 2017 / 10:41 PM / 5 months ago

UPDATE 2-Mexico America Movil profit surges on forex gains

(Adds America Movil comments, share price)

MEXICO CITY, April 25 (Reuters) - Mexican billionaire Carlos Slim’s telecoms company America Movil posted a sevenfold increase in first-quarter net profit on Tuesday, beating analyst expectations as the peso appreciated against the dollar and euro.

Quarterly net profit at Latin America’s biggest telecom company jumped to 35.85 billion pesos ($1.91 billion), up from 4.798 billion pesos in the year-ago quarter.

America Movil said revenue was 264.16 billion pesos for the quarter, up from 222.99 billion pesos in the same three-month period last year.

The company’s quarterly performance beat expectations for a 27.27 billion-peso profit forecast by a Reuters poll last week.

America Movil’s results, which followed its biggest loss in 15 years in the fourth quarter, were helped by the Mexican peso’s recent rally.

America Movil said that in the wake of the U.S. election, increased uncertainty about the North American Free Trade Agreement hurt consumer sentiment and pummeled the peso.

“By the end of the quarter retail sales were surging and the peso versus the dollar had risen to its best level since the U.S. election,” it said.

The peso was the best-performing currency year-to-date among the 36 most-traded in the world, Reuters data shows.

During the election campaign, Trump threatened to impose punitive tariffs on imported goods produced in Mexico and to tear up a joint trade agreement with Latin America’s No. 2 economy. Mexico sends about 80 percent of its exports to the United States.

But a softer tone on bilateral trade with Mexico from some in Trump’s administration fueled the peso’s recent rally.

Net debt fell to 584 billion pesos from 630 billion in December mainly due to the appreciation of the peso versus the dollar and the euro, America Movil said.

America Movil shares ended the day up 1.21 percent at 14.17 pesos per share before the company reported its results.

$1 = 18.7275 on March 31 Reporting by Anthony Esposito and Noe Torres; Editing by Matthew Lewis and Andrew Hay

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