Sat | Aug 24, 2019

FLOW Jamaica hauls in $23b over six months

Published:Wednesday | August 15, 2018 | 12:00 AMSteven Jackson/ Senior Business Reporter
A FLOW Jamaica store in Kingston.

Telecommunications provider Cable & Wireless Jamaica, which trades as FLOW, earned US$183 million ($23 billion) in revenue over six months ending June, derived in part from price increases.

The 6.5 per cent spike in sales made Jamaica the top growth performer within the Cable & Wireless Communications group acquired by Liberty Latin America. Liberty executives described the Jamaican market reaction as rational.

"We spent a fair amount of capital on upgrades and new construction and its starting to pay off. We see that in fixed line growth as well in Jamaica and Trinidad. So we see some positives and see it as a very rational market," said Liberty Latin America CEO Balan Nair last week in an investors conference called following the release of the group's half-year earnings report.

"We have a competitor that is also acting very rationally, and you see they have taken price increases and we feel good about it," Nair added.

FLOW Jamaica's profits were not disclosed in Liberty Latin America's financials. It was the only market itemised within the C&W network that grew revenues year on year. Panama was down to US$302 million from US$308 million; Bahamas dipped to US$122 million from US$138 million; Barbados dipped to US$77 million from US$81 million; and Trinidad & Tobago dipped to US$81 million from US$84 million.

Liberty did earn more in its 'other' C&W markets in the region, which grew to US$212 million compared to US$207 million the previous year. It describes those markets as countries in which "C&W has less significant operations".

"In Jamaica, we increased our prices in the last quarter and we have seen that the market is managing very rationally the value proposition, the increased quality and value offering to customers especially on mobile.

So we are not too concerned because we are managing our position in the market in a rational way," said Chief Operating Officer Betzalel Kenigsztein on the investor conference call.

In the areas of cable, broadband and fixed line growth, Jamaica's customer base rose 3.1 per cent to 479,100; Panama grew 1.8 per cent to 314,000; Trinidad by 2 per cent to 292,700; and Barbados by 1.3 per cent to 157,500. Bahamas dipped 1.2 per cent to 80,400.


Dip in subscribers


In mobile services, subscribers dipped in Jamaica by 1.7 per cent to 907,600 as at June 30 relative to the March quarter; Panama fell 3 per cent to 1.63 million; Bahamas dipped 4 per cent to 240,700; while Barbados was down 2.1 per cent to 120,100.

Earlier this year, Liberty Latin America spent US$19.7 million to acquire minority shares in C&W Jamaica. The take-up of the offer increased its stake from 82 per cent to 92.3 per cent at $1.45 per share. Liberty subsequently took C&W Jamaica private and delisted it from the Jamaica Stock Exchange. The offer came two years after Liberty Global bought up CWC Plc and its country operations.

Initially, Liberty had fought a push by minority owners to make the offer the case began before the Financial Services Commission and subsequently ended up in closed door hearings in court but subsequently launched the buy-out, anyway. The company never explained its change of heart.