Good morning. My name is Christina, and I will be your conference operator today. At this time, I would like to welcome everyone to the América Móvil First Quarter 2020 conference call and webcast. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press the pound key. Thank you. Now I will turn the call over to Ms. Daniela Lecuona, Head of Investor Relations.
Thank you. Good morning, everyone. We're here today to present our first quarter 2020 financial and operating results. We hope everybody's safe. We have today on the line Mr. Daniel Hajj, our CEO; Mr. Carlos García Moreno, CFO; and Mr. Óscar Von Hauske, Chief Operating Officer.
Thank you, Daniela, welcome everyone to the first quarter 2020 financial and operating report. I'm going to pass to Carlos so he can give us a summary of the first quarter results. Carlos?
H ello, everyone. Yep. Good morning, everyone. We have a strong, with all our main operations performing well. Measures went forth in all countries. Most of them around mid-March, operational trends began to change. There is no clarity as to its duration and magnitude overall or its impact in the countries where we operate. In América Móvil, we have been fully committed to ensuring the continuity of our top-quality services, prioritizing the health and well-being of our clients and employees, and adapting our processes and commercial plans to accommodate the needs of our subscribers. We will continue to work together with our various stakeholders through this journey.
Signs of the emergence of the coronavirus pandemic in China early in the first quarter and of the ensuing contagion of other regions, first in Europe and then in the Americas, brought about a chaotic response of financial markets concerned that a major economic contraction would follow. Over the last several weeks, the full or partial lockdown of various countries has resulted in a sharp collapse of economic activity and rapidly rising levels of unemployment. Most Latin American currencies depreciated versus the U.S. dollar, with Mexican peso losing 25% in relation to the levels at the close of 2019. The operations, we gained 1.4 million mobile postpaid subscribers in the first quarter, including 874,000 in Brazil and 215,000 in Mexico.
In addition, we incorporated three and a half million postpaid clients that came to us with the acquisition of Nextel Brazil. Fixed broadband is still the main driver of the fixed-line platform. We connected 402,000 new accesses, including 107,000 in Brazil and 105,000 in Mexico. Mobile postpaid and fixed broadband continued to be the main drivers of access growth with 7.8% and 3. 5 % respectively. All other access lines continued to decline year-over-year. Our consolidated revenues expanded at a rapid pace as several operations, including Mexico, Brazil, and Colombia, posted their best revenue increase in at least five quarters.
Consolidated revenues, MXN 250 billion, were up 1.8% year-on-year in Mexican peso terms, with service revenue growing 5.0% at constant exchange rates from a year before and EBITDA rising 8.3%. Mobile services were the main driver of revenue growth at 8.4%, the more dynamic pace in several quarters, while fixed-line services continued to decline slightly. Mobile service revenues increased 15.4% in Brazil, not including Nextel, and approximately 10% in Mexico, Colombia, and the Dominican Republic. Whereas fixed service revenues expanded also around 10% in Argentina and Colombia, with Ecuador posting 14.5% growth.
Postpaid revenue was up 13.6% at constant exchange rates all throughout América Móvil, partly on account of the incorporation of Nextel, as several countries experienced an acceleration of revenue growth. Prepaid service revenue expanded at 3.9% all throughout the group. Although Mexico, Colombia, and Dominicana, which is where the prepaid is more relevant, saw 13% increases. Mobile ARPU rose in most countries from the year before driven by data services as data consumption per client kept on increasing rapidly. Fixed broadband revenues of 7.8%, which is the second most dynamic business line in the group after mobile postpaid, did not manage to fully offset the decline seen in broadband ARPU revenues. Peru, Colombia, and Ecuador presented sequential improvements and the best results in over a year.
In Mexico, prepaid revenues, as I mentioned before, shot up 13%, with postpaid revenues accelerating to 6.8%. On the fifth platform, data and revenues recovered at 13%, and fixed voice continued on an improving trend, all of which resulted in EBITDA shooting up 12%. In Brazil, pro forma, and this is us including Nextel for the full year for comparisons, mobile postpaid revenue growth stood at 17.2%, with prepaid trends improving. On the fixed line platform, data and revenues expanded 6.3%, but wasn't able to maintain a declining trend. Nonetheless, EBITDA shot up 7.5%. In Colombia, service revenues expanded at similar rates on both the mobile and the fixed line platforms, approximately 9.5% on each one. On mobile, prepaid revenues surged 13.5%, with postpaid moving up to 7.7%. On fixed, mobile and service revenues continued to shine at nearly 13%.
EBITDA expanded rapidly in all our main operations, rising more rapidly in Mexico at nearly 12%. In Brazil and Colombia, EBITDA was up 7.5% and 8.2%, as we had mentioned before. Peru stood out with a 13.5% year-on-year increase. Our comprehensive financing cost totaled MXN 79.6 billion, resulting from MXN 93 billion in foreign exchange losses stemming from the depreciation of the Mexican peso vis-à-vis the U.S. dollar and the euro. They gave rise to a MXN 29 billion net loss in the quarter. Most of our debt has been raised in international markets, as we all know, in hard currencies. If the company is based in Mexico, the debt is therefore subject to foreign exchange valuations.
The exposure arising from this funding is managed through the use of financial derivatives and has been significantly reduced over the last 12 months to better conform to the currency mix of our revenue base and equity investments. Our net debt in this March at MXN 817 billion. In cash flow terms, it was up MXN 24.6 billion year-to-date, which helped us fund a seasonal increase in working capital. Our net debt to EBITDA for the last 12 months stood at 8.7 x under the prior methodology of IAS 17, which is the one that we have continued to use for comparison purposes with last year. With this, I would like to pass the floor back to Daniel. Daniel?
Thank you.
Thank you, all. We'll begin with the questions.
Yes. First question?
My apologies. At this time, I would like to remind everyone, in order to ask a question, press star then the number one on your telephone keypad. Your first question is from someone from the Bank of America. Please state your first and last name. Your line is open.
Yes. Thank you. Hi, good morning, Daniel, Carlos, Oscar, and Daniela. I hope you and your families are well considering the crisis that we're going through. This is Rodrigo Villanueva from Bank of America. I have a couple of questions. First, wireless growth across countries in Latin America has been pretty solid for AMX over the last several quarters, mostly driven by increased data usage. Now that many customers are probably using more Wi-Fi networks due to the stay-at-home measures, would you expect to see significant reduction in wireless data growth? That would be my first question. Thank you.
Good morning, Rodrigo. I don't hear you very well, the question. It depends on capacity. People is using a lot on Wi-Fi. What I can tell you is that we have almost one month with a lockdown in all the countries, and the capacity in wireless is growing around 10% more than what we have been seeing it's growing. That's one issue. The other issue in that is that there are some places like the commercial areas where we have a lot of traffic, and this traffic is moving to places where people live, to more to residence places. It's not only the growth of the traffic, it's also that the traffic is moving from one place to another on the same city or from one place to the other one.
Let's say in places where we have a lot of tourism, this is really the traffic is go down very fast and move to places where the people live right now. It's incrementally not so much. It's 10% more on what we have been seeing, what we have been having. The moving of the traffic is the one that we are reviewing. Overall, what we're seeing is that all the big investments that we have been doing in the last years in, let's say, 4.5G ready, modernizing the networks, the fiber, putting new technology, increasing our backhaul. We have, I think, the greatest backhaul in Latin America. All Single RAN. Single RAN permit us to move also traffic very fast. From one place to the other one, from 2G to 3G to 4G to 4.5G.
All of those things have been helping us to have very good capacity. We have a stress test on the networks, and everything is working perfectly.
Understood. Thank you very much, Daniel. Then my second question is related to CapEx deployment. At the beginning of the year, the target was of around $8.5 billion. I believe you already revised this number, probably 20% lower. I was wondering if there is a possibility to take it even lower than that, and where would you be focusing your investments in 2020? Thank you.
First I want to, again, repeat that we have the best networks in Latin America today by far. All the investments that we have been doing the last five years, again, in everything, frequencies, infrastructure, 4G, 4.5G, VoLTE, Open RAN, Single RAN, everything, it's working today. Today, we are seeing that we have an excellent networks, that the networks are growing, the traffic is growing without any problem. Today it's difficult because we don't have visibility on really what is going to happen, because today, what's happening today? I see the COVID crisis in two ways, okay? The second quarter, I think we're going to see the lockdown in all the countries. Too much people, not in the streets, everybody's going to be in their houses. Not a lot of activations.
In terms of prepaid, I don't see that we're going to sell too much. I don't see that in concept it's going to be reduced a lot. Concept traffic is going to grow, and that's going to be more or less what we see in the second quarter. In the third quarter, we're going to see other things now. We're going to see some problems all around the world in the economic part. That's very difficult to see the visibility on what is going on in the rest of the year. I think, yes, that we can defer part of our CapEx, an important part of our CapEx, and all of that will be without sacrificing any on the quality, on the capacity, availability, and having always the best technology there. Yes, we can reduce far below the 20%. Yes. I don't have a number.
Thank you very much.
We are a very flexible company, so we can stay. When we have more visibility, then we're going to take the decision what we're going to do, which projects we are going to take out or defer, and which other ones we are going to put, and because things are moving. Online is growing a lot in terms of things that we do online instead of doing personally in the customer care center. All these projects, I think we're going to move faster than what we have been doing, but other ones, maybe we're going to stop them. We need to see really what's going to be the end of this and what's going to be the traffic, and then we're going to take the decision on that.
Understood, Daniel. Very clear. Thank you very much.
Thank you.
Your next question comes from Marcelo Santos from JPMorgan. Your line is open.
Hi. Good morning. Thanks for taking the question, and hope you are well and stay well. The first question would be if you could give a little bit more detail on the behavior in the last two weeks, especially two weeks of the quarter, especially on the main markets, Brazil, Mexico, maybe Colombia, on how the different lines behave. Like we saw, for example, prepaid, very strong growth, Brazil and Mexico, in the quarter. How did that behave towards the end of the quarter? If you could anticipate a bit of what happened in April. This is the first question.
Well, the COVID crisis and the lockdown starts in first week in Austria, maybe second and third week in the other countries. In April, we have lockdown all the countries in Latin America. I think Europe, Austria is different than what we have in Latin America. In Latin America, what we are seeing is very different things in each of the countries. I think we have more strong lockdowns in countries like Ecuador and Peru. In Mexico, Brazil, and Colombia, we passed from phase I then to phase II, and then we are in phase III in Mexico, let's say. What we're seeing all overall in the main countries is a big reduction on handset sales. Handset, people is not getting out and buy handset. On the postpaid side, I think activations decreasing. Revenue, I think it's okay.
In prepaid, it's not big reductions on the prepaid side as people who can't go out or they don't have the money today to buy this card. It's more or less what we are seeing in the big countries. In other countries where the lockdowns are more strong, like Ecuador and Peru, and that some regulations that you cannot disconnect the subscribers, postpaid subscribers, then we're seeing a little bit of some people who's not paying, and then we need to see when the lockdown is finished, then we're going to see how many of those will pay and how many of these accounts will cancel. All overall, I think during April, we're seeing these indicators. It's activations low, selling handsets going down very fast, and the revenues more or less, a little bit less than what we have in March.
Thank you. Just a follow-up on this first question. Broadband remains at a strong pace in April. This will be the follow-up. The second question is your comment about government action. Could you summarize what are the main government actions in the countries which affected you in a relevant way? You mentioned Peru, you mentioned Ecuador, but are there other important government actions that impacted you elsewhere? Thank you.
Well, in broadband is doing good. Broadband is still growing even with everything closed in April. Broadband is still growing in April. Let's see what's going to happen on May and June. Fixed broadband is growing. It's been a very good product and people consuming. That's doing okay. I think it's the best product right now in terms of the lockdown, is the one that people is asking for. Other products, like all the things that Oscar can talk a little bit later about what we're selling, because there's a lot of people going to home office, and we're having a lot of sales on these products. In governments, well, I think, let's talk a little bit about Mexico. In Mexico, we have been helping in prepaid. Maybe to 28 million customers, we give for free a package of minutes and SMS during April.
We offer to all of our prepaid customers, the ones that download that package, it's for free, and they can talk some minutes and SMS. They do it for free. We have also some reduction in our plans for this timing. If you cannot pay, then we reduce you the rent for two, three months until everything is done, and then you, again, increase your postpaid plan. We're having all around the country a lot of different plans, and we call them sometimes emergency plans for our people to help them and to stay connected. We have that. In terms of the regulators, I think the only thing that I don't think it's a very good idea, let's call them that way, is that they allow them not to pay.
Like Ecuador and Peru, they said, if you cannot pay because we are in lockdown, then you cannot disconnect the line. I think these two countries and maybe other ones in Central America, I don't remember exactly which ones, which have that, but I don't think it's a good idea for nobody. That's only in those countries where we have that.
Perfect. Thank you very much. Very clear.
Thank you.
Your next question comes from Maria Azevedo from Santander. Your line is open.
Hi, thank you everyone for taking the questions. My first question is on competition. You're seeing lower churn, especially where the stores are closed and players are adopting a more defensive mode, Telefónica reducing the focus in some countries. Do you think you can be a bit more aggressive commercially, or is it time to be more defensive?
I don't see more aggressiveness in the commercial side in April. I think everybody's a little bit. Doesn't make any sense because nobody's in the streets, nobody's buying, doesn't make any sense to have more aggressive products in April. I don't think in May. I don't know really when we finish this lockdown and people start going out and start going again and buying. I don't know how the competition would be, but I'm not seeing more aggressive plans all overall in the countries these days. Doesn't make any sense, I don't think so. I think today what we need to do is to take care about our customers, to have a good quality, to give more options online to all our customers, and to work on having the capacity, the quality, and to give a very good service.
I think people working from their homes need that service, and we're giving that. I think all overall in Latin America, by far, we are the best networks in Latin America.
Thank you very much. This is very reassuring. As a follow-up question, as you're approaching your leverage targets and cash flow remains strong, do you see any interesting M&A opportunities, not only in Brazil but also in LATAM in general? If you can comment anything on synergies expectations from the Nextel Brazil acquisition, that would be very helpful. Thank you very much.
I don't hear the first part of the question. In Nextel, I think we're working on the synergies. I think it was very good for us. We incorporate 3.5 million customers, post-paid customers to our base in Brazil, and we're working very hard. All the synergies, we're not going to get it immediately, but I think in the next year, all this year, we're going to work on that. We have a plan and we're executing that plan. I think it's a very good purchase for América Móvil. Other things on mergers, we are not seeing any other merger today. We're only focusing today on being very strong financially, to have liquidity, to be careful on the inventory, because today, liquidity cash is very important, and we are being very careful and Carlos can talk a little bit about that.
No, we're not seeing anything on buying or merging something in the short term. Always, we're open to anything, but today we're not seeing any.
Perfect. Thank you very much.
Thank you.
Your next question comes from Carlos de Legarreta from GBM. Your line is open. Please go ahead.
Thank you so much for taking the question, and I hope everybody is safe and healthy. My first question is perhaps for Carlos. If you could provide more color on the measures you have taken to improve liquidity, specifically the amount of credit lines that you have drawn and the ones that are still available. Thank you.
Can you repeat the question? I couldn't hear it.
Sorry. Just regarding the measures to improve liquidity, Carlos, if you could talk about the credit lines that you have drawn and the ones that are still available, that would be helpful. Thank you.
Okay. We have drawn, as we found out, two committed lines. We have one for $2.5 billion, and the other one for a little bit less than EUR 2 billion. We basically have them to be able to face situations when, on account of things nothing to do with the company, as is the case today, the financial markets will not be functioning properly. We decided to draw on these lines at the time that we did it, towards the end of March, the financial markets were very much dislocated. I think that we are in a good position. We had a big motivation to do, we have at the end of May, which is a EUR 3 billion bond that was exchangeable into KPN shares. This bond we printed for one to two weeks ago, and that we have already paid down roughly half of the bond.
The other half will be paid at the end of May. We do have a number of other lines of credit. They are all short-term in nature. I'd say, in all, I think we have probably MXN 1 billion, MXN 1.5 billion of lines that are partly being used today, but not fully. We do not expect that we would require any further financing to be able to pay down the maturity that we have this year or even next year. I think the cash flow we expect will be resilient and should allow us also to maintain good liquidity.
Thank you. That's very helpful. If I may, a follow-up. Regarding collections, would it be possible to talk about how dependent is the in-store channel payment for collections and if that can be a problem down the road if the lockdown measures extend?
The question is about what? Regarding collections?
Not in the quarter, just overall, the collections, how much are they dependent on in-store payment? given that most malls.
Sure.
Some shopping centers are closed, that can be a problem anyway.
I think, this is something that covers many countries, where you have different situations, most places. Obviously, prepaid is not an issue. It's directly linked to the charges. In the case of invoices that we collect, there could have been a little bit of a disruption on accounts, for instance, whenever banks have been closed. We have been moving everything more to a digital payment mechanism. We are, at this point, not having much to present in general for the group as a whole. This is something that we are monitoring closely, both the cash collections overall and the past due accounts, account receivables. We monitor this very closely. I don't think that there's anything that we can report as significant at this point. We are paying a lot of attention and making sure that we don't have any issue.
Thank you so much.
Thank you.
Again, if you would like to ask a question, please press star then the number one on your telephone keypad. We do have another question from [Fred Mendes]. Please state your company. Your line is open.
Good morning, everyone. Thanks for the call. I have two questions here. I want to more talk to Brazil, actually. I saw, once again, very strong results on the mobile segment. My apologies if this question was already made. I had joined the call late. Very strong results once again. You are delivering 10% growth mobile service revenue, while the other guys are delivering low single digits. That definitely calls the attention. I'm just wondering if these very solid results, even on the prepaid as well, + 5%, if these solid results comes more from doing upselling on your own base. Basically, of course, increasing ARPU and then selling more for more, more data for more price, or you basically being able to gain a lot of clients from competition. If you can give us that, from any specific company as well.
Just trying to understand the very strong results on the mobile front in Brazil. Thank you.
Yes. Thank you for the call. Yes, we have very good strong results in América Móvil. Also, especially in the postpaid and prepaid side, in the mobile side. We can see that in Mexico, we have very strong results. That's really because it's because of our good network, so people is preparing to move to our network. It could be a little bit more on consumption, but there's also part that will be on gaining market share. In Mexico, definitely we are doing very well. We have the best distribution networks, so very good brand. We have recently, Opensignal studies where we have the best availability, uplink, downlink, latency, and people is looking for quality. That's very important, and that's why we are growing. In Brazil also, we are growing very strong.
We have been putting a lot of money in the CapEx in the last years, in postpaid, in prepaid, in all the mobile side, growing coverage, growing 4.5G speeds. We have the best speed in 4.5G in Brazil. I think we get almost million subscribers per quarter for the last three or four quarters. That's also, I think, we're gaining. Let's see the last numbers when everybody reports, I think we are also gaining a little bit on market share there. Colombia also moving good. We are growing in Colombia. We're growing prepaid and postpaid, very strong prepaid and very strong postpaid. Overall, in the rest of the countries also, we're doing good. Chile, we're starting to grow again, Peru, we're doing excellent. Dominican Republic, very good. Overall, we are doing very good.
In Mexico especially, we have been having very good increases in the prepaid market. Prepaid has been growing very strong, using a lot more data, moving to better balances. They used to charge, let's say MXN 50, Today they are charging MXN 100. People is moving. People is consuming more and more in prepaid in Mexico. I can tell you that it's distribution, it's competition, it's more consumption, better networks, everything together. I cannot say that's something that is what is helping most. No, I think it's all overall a big work on the last three years, two years, that is giving us these results today.
Thank you very much, Daniel. Very, very clear. Thank you.
Thank you.
I would now like to turn the call back over to Mr. Daniel Hajj for closing remarks.
I just want to thank you, everybody, for being in the call. Carlos, Daniela, Oscar. Thanks very much, everyone. Bye-bye.
This concludes today's conference call. You may now disconnect.