SECURITIES AND EXCHANGE COMMISSION
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes _______ No ___X____VIVO, SOUTH HEMISPHERE’S LARGEST WIRELESS COMMUNICATION GROUP, ANNOUNCES FOURTH QUARTER 2005 AND YEAR 2005 CONSOLIDATED RESULTS OF TELE CENTRO OESTE CELULAR PARTICIPAÇÕES S.A. |
Brasília – Brazil, February 23, 2006 – Tele Centro Oeste Celular Participações S.A. - TCO, (BOVESPA: TCOC3 (ON = Common Shares)/TCOC4 (PN = Preferred Shares); NYSE: TRO), discloses today its consolidated results for the fourth quarter of 2005 and year 2005 (4Q05 and 2005). TCO operates in the Federal District and in eleven Brazilian states: Acre, Amazonas, Amapá, Goiás, Maranhão, Mato Grosso, Mato Grosso do Sul, Pará, Rondônia, Roraima and Tocantins, covering an area of 5.8 million km2 with 32.5 million inhabitants, which is approximately 18% of the total Brazilian population.
HIGHLIGHTS | |||||||||
Accum. | |||||||||
R$ million | 4 Q 05 | 3 Q 05 | Δ% | 4 Q 04 | Δ% | 2005 | 2004 | Δ% | |
Net operating revenue | 569.2 | 579.8 | -1.8% | 608.9 | -6.5% | 2,271.5 | 2,210.5 | 2.8% | |
Net service revenues | 489.0 | 520.2 | -6.0% | 505.0 | -3.2% | 1,972.7 | 1,879.6 | 5.0% | |
Net handset revenues | 80.2 | 59.6 | 34.6% | 103.9 | -22.8% | 298.8 | 330.9 | -9.7% | |
Total operating costs | (453.1) | (396.6) | 14.2% | (403.8) | 12.2% | (1,622.2) | (1,319.2) | 23.0% | |
EBITDA | 116.1 | 183.2 | -36.6% | 205.1 | -43.4% | 649.3 | 891.3 | -27.2% | |
EBITDA Margin (%) | 20.4% | 31.6% | -11.2 p.p. | 33.7% | -13.3 p.p. | 28.6% | 40.3% | -11.7 p.p. | |
Depreciation and amortization | (70.3) | (67.9) | 3.5% | (58.2) | 20.8% | (262.8) | (210.0) | 25.1% | |
EBIT | 45.8 | 115.3 | -60.3% | 146.9 | -68.8% | 386.5 | 681.3 | -43.3% | |
Net income | 63.2 | 92.5 | -31.7% | 129.6 | -51.2% | 339.1 | 507.1 | -33.1% | |
Profit per share (R$ per share) | 0.49 | 0.71 | -31.7% | 1.01 | -51.7% | 2.61 | 3.93 | -33.7% | |
Profit per ADR (R$) | 0.49 | 0.71 | -31.7% | 1.01 | -51.7% | 2.61 | 3.93 | -33.7% | |
Number of shares (million) | 130.1 | 130.1 | 0.0% | 128.9 | 0.9% | 130.1 | 128.9 | 0.9% | |
Capex | 140.1 | 48.8 | 187.1% | 139.2 | 0.6% | 357.0 | 419.3 | -14.9% | |
Capex over net revenues | 24.6% | 8.4% | 16.2 p.p. | 22.9% | 1.8 p.p. | 15.7% | 19.0% | -18.8 p.p. | |
Operating cash flow | (24.0) | 134.4 | n.a. | 65.9 | n.a. | 292.3 | 472.0 | -38.1% | |
Customers (thousand) | 6,815 | 6,561 | 3.9% | 5,820 | 17.1% | 6,815 | 5,820 | 17.1% | |
Net additions (thousand) | 255 | 75 | 239.5% | 513 | -50.4% | 995 | 1,708 | -41.8% |
Tele Centro Oeste is controlled by Telesp Celular Participações S.A. which, along with Tele Leste Celular Participações S.A., Tele Sudeste Celular Participações S.A. and Celular CRT Participações S.A,, make up the assets of the Joint Venture undertaken by Portugal Telecom and Telefónica Móviles and, operating under the VIVO brand, Top of Mind within its coverage area. VIVO Group is a pioneer in 3rd generation services in Brazil, having launched the CDMA EV-DO technology in the main cities of the country and having won more than 40 prizes in 2005. In December 2005, VIVO Group exceeded 29 million customers, thus keeping its market leadership.
HIGHLIGHTS 4Q05 |
|
VIVO |
Vivo launched a campaign in October 2005, called “Vivo e Você na Copa” (Vivo and You in the World Soccer Cup), which is focused on the current customer base (post and prepaid), aiming at increasing profitability. Such campaign will take 75 customers with companion to watch Brazil’s games in the 2006 World Soccer Cup, being valid until March 31, 2006. To end the year, Vivo granted an unprecedented and quite attractive benefit, easily understood by the customers, which was intended to exploit freedom in using wireless phones with the “Natal Bônus Livre” (Free Bonus Christmas), a bonus of R$ 40/month (during 6 months) for local calls to any direction (wireless or fixed telephone), conditioned upon monthly recharge and punctual payment of postpaid bills, in addition to a data package (SMS and MMS). |
Distribution Channels | On December 31, 2005, TCO had more than 70 own purchase points, in addition to an efficient network of accredited dealers, whether exclusive or not, totaling more than 1,900 points of purchase, which are able to market services and cellular handsets, thus making the Company also a leader in number of distribution channels. |
Others Events | On December 2, 2005 the Supreme Federal Court judged favorably an injunction based on the unconstitutionality of the base for the calculus of the PIS and of the COFINS. The said injunction was filed by TCO and consequent to the decision, the Company promoted the reversal of the outstanding provision in the amount of R$ 9.5 million. The other Companies, TC, TCP and GT carry similar injunctions, which altogether add up to R$ 140.3 million as of December 31, 2005 and, relative to these injunctions, the referred Companies will wait for the respective decisions by the Supreme Federal Courts to proceeds the reversal of the relative provisions. The Norte Brasil Telecom (PA, AM, AP, RR and MA), the Telemat Celular S/A (MT), the Teleacre Celular S/A (AC) and the Teleron Celular S/A (RO) obtained the approval by the ADA (Agência de Desenvolvimento da Amazônia) and the Receita Federal for the fiscal incentives to the reduction of the IRPJ (Income Tax) through the income from exploration. The said benefit is retroactive to 2004 and will be used up till 2013. The Companies will have the respective rights granted in the amounts of R$ 20.4 millions and R$11.6 millions related to the years 2004 and 2005, respectively. |
Basis for Presentation of Results | The accumulated totals for 2005 and 2004 correspond to the values recorded in the twelve-month period ended on December 31 of the above mentioned years. Some information disclosed for 4Q04, 3Q05 and accumulated 2004 were re-classified, as applicable, for comparison purposes. Figures disclosed are subject to differences, due to rounding-up procedures. |
CONSOLIDATED OPERATING PERFORMANCE - TCO | |||||||||
Accum: |
|||||||||
4 Q 05 |
3 Q 05 |
Δ% |
4 Q 04 |
Δ% |
2005 |
2004 |
Δ% |
||
Total number of customers (thousand) |
6,815 |
6,561 |
3.9% |
5,820 |
17.1% |
6,815 |
5,820 |
17.1% |
|
Contract |
970 |
978 |
-0.8% |
945 |
2.6% |
970 |
945 |
2.6% |
|
Prepaid |
5,845 |
5,583 |
4.7% |
4,875 |
19.9% |
5,845 |
4,875 |
19.9% |
|
Market Share (*) |
45.5% |
47.0% |
-1.5 p.p. |
51.3% |
-5.8 p.p. |
45.5% |
51.3% |
-5.8 p.p. |
|
Net additions (thousand) |
255 |
75 |
239.5% |
513 |
-50.4% |
995 |
1,708 |
-41.8% |
|
Contract |
(8) |
0 |
n.a. |
5 |
n.a. |
25 |
(4) |
n.a. |
|
Prepaid |
262 |
75 |
249.8% |
508 |
-48.4% |
970 |
1,712 |
-43.3% |
|
Market Share of net additions (*) |
24.8% |
10.7% |
1.3 p.p. |
34.8% |
-10.0 p.p. |
45.5% |
51.3% |
-5.8 p.p. |
|
Market penetration (*) |
44.0% |
41.0% |
3.0 p.p. |
34.8% |
9.2 p.p. |
44.0% |
34.8% |
9.2 p.p. |
|
SAC (R$) |
101 |
122 |
-17.6% |
124 |
-18.9% |
129 |
108 |
19.0% |
|
Monthly Churn |
1.6% |
1.9% |
-0.3 p.p. |
2.3% |
-0.6 p.p. |
1.6% |
2.0% |
-0.4 p.p. |
|
ARPU (in R$/month) |
24.6 |
26.5 |
-7.3% |
30.5 |
-19.4% |
25.9 |
32.0 |
-19.0% |
|
Contract |
86.8 |
91.0 |
-4.6% |
82.4 |
5.3% |
83.7 |
84.2 |
-0.6% |
|
Prepaid |
12.4 |
13.0 |
-4.5% |
16.3 |
-23.8% |
13.5 |
16.9 |
-20.2% |
|
Total MOU (minutes) |
68 |
72 |
-6.2% |
86 |
-21.4% |
73 |
87 |
-15.7% |
|
Contract |
225 |
236 |
-4.7% |
213 |
5.6% |
221 |
208 |
6.2% |
|
Prepaid |
38 |
40 |
-5.1% |
55 |
-31.0% |
43 |
55 |
-21.0% |
|
Employees |
1,276 |
1,263 |
1.0% |
1,357 |
-6.0% |
1,276 |
1,357 |
-6.0% |
Consolidated TCO’s Operating Highlights |
|
OPERATING PERFORMANCE - CO - AREA 7 | |||||||||
Accum: |
|||||||||
4 Q 05 |
3 Q 05 |
Δ% |
4 Q 04 |
Δ% |
2005 |
2004 |
Δ% |
||
Total number of customers (thousand) |
5,070 |
4,929 |
2.9% |
4,491 |
12.9% |
5,070 |
4,491 |
12.9% |
|
Contract |
778 |
787 |
-1.1% |
787 |
-1.1% |
778 |
787 |
-1.1% |
|
Prepaid |
4,292 |
4,142 |
3.6% |
3,704 |
15.9% |
4,292 |
3,704 |
15.9% |
|
Market Share (*) |
50.0% |
51.9% |
-1.9 p.p. |
59.1% |
-9.1 p.p. |
50.0% |
59.1% |
-9.1 p.p. |
|
Net additions (thousand) |
142 |
11 |
1188.0% |
312 |
-54.5% |
580 |
1,180 |
-50.9% |
|
Contract |
(9) |
(3) |
197.0% |
(6) |
41.8% |
(9) |
(13) |
-33.8% |
|
Prepaid |
151 |
14 |
975.6% |
318 |
-52.6% |
588 |
1,193 |
-50.7% |
|
Market Share of net additions (*) |
22.1% |
2.3% |
19.8 p.p. |
30.6% |
-8.5 p.p. |
22.8% |
44.5% |
-21.7 p.p. |
|
Market penetration (*) |
61.2% |
57.4% |
3.8 p.p. |
47.9% |
13.3 p.p. |
61.2% |
47.9% |
13.3 p.p. |
|
(*) source: Anatel |
Operating Highlights - Area 7 (CO) – which comprises the Federal District and the following States: Acre, Goiás, Mato Grosso, Mato Grsso do Sul, Rondônia and Tocantins |
|
OPERATING PERFORMANCE - NBT - AREA 8 |
|||||||||
Acucm: |
|||||||||
4 Q 05 |
3 Q 05 |
Δ% |
4 Q 04 |
Δ% |
2005 |
2004 |
Δ% |
||
Total number of customers (thousand) |
1,745 |
1,632 |
6.9% |
1,329 |
31.3% |
1,745 |
1,329 |
31.3% |
|
Contract |
192 |
191 |
0.4% |
158 |
21.4% |
192 |
158 |
21.4% |
|
Prepaid |
1,553 |
1,441 |
7.8% |
1,171 |
32.6% |
1,553 |
1,171 |
32.6% |
|
Market Share (*) |
36.1% |
36.7% |
-0.6 p.p. |
35.5% |
0.6 p.p. |
36.1% |
35.5% |
0.6 p.p. |
|
Net additions (thousand) |
113 |
63 |
79.3% |
201 |
-43.8% |
415 |
528 |
-21.4% |
|
Contract |
1 |
3 |
-60.5% |
11 |
-89.4% |
33 |
9 |
270.1% |
|
Prepaid |
112 |
60 |
86.3% |
190 |
-41.1% |
382 |
519 |
-26.4% |
|
Market Share of net additions (*) |
29.4% |
32.2% |
-2.8 p.p. |
44.0% |
-14.6 p.p. |
38.3% |
41.6% |
-3.3 p.p. |
|
Market penetration (*) |
27.6% |
25.5% |
2.1 p.p. |
22.5% |
5.1 p.p. |
27.6% |
22.5% |
5.1 p.p. |
Operating Highlights - Area 8 (NBT) – which comprises the following states: Amazonas, Amapá, Maranhão, Pará and Roraíma |
|
NET OPERATING REVENUES - TCO | |||||||||
According to Corporate Law |
|||||||||
Accum. |
|||||||||
R$ million |
4 Q 05 |
3 Q 05 |
Δ% |
4 Q 04 |
Δ% |
2005 |
2004 |
Δ% |
|
Subscription and Usage |
290.2 |
309.1 |
-6.1% |
274.0 |
5.9% |
1,124.6 |
981.8 |
14.5% |
|
Network usage |
178.7 |
188.4 |
-5.1% |
220.7 |
-19.0% |
761.9 |
840.1 |
-9.3% |
|
Other services |
20.1 |
22.7 |
-11.5% |
10.3 |
95.1% |
86.2 |
57.7 |
49.4% |
|
Net service revenues |
489.0 |
520.2 |
-6.0% |
505.0 |
-3.2% |
1,972.7 |
1,879.6 |
5.0% |
|
Net handset revenues |
80.2 |
59.6 |
34.6% |
103.9 |
-22.8% |
298.8 |
330.9 |
-9.7% |
|
Net Revenues |
569.2 |
579.8 |
-1.8% |
608.9 |
-6.5% |
2,271.5 |
2,210.5 |
2.8% |
Net Services Revenue |
The net services revenue grew 5.0% in the accumulated total for 2005 in comparison to 2004, recording R$ 1,972.7 million. Such growth was caused, mainly, by the increase in the customer base and by the increased use of data services, despite the effects of the customer profile adequacy, such as Vivo Ideal and customer loyalty campaigns. It must be highlighted that “subscription and usage revenue” recorded a 14.5% increase in the accumulated total for 2005 over 2004, due to the increase in the total outgoing traffic. In the service revenue mix, this increase was partially offset by a reduction in the inbound traffic revenue, as a result of the transition from fixed-mobile traffic to mobile-mobile traffic, with consequent drop in interconnection revenue and the partial Bill & Keep effect. Data revenues grew 39.5% in the comparison between the accumulated total for 2005 and for 2004, representing 5.6% of the net service revenues in 2005 (4.2% in 2004). This increase has continued to occur due to a more widespread access and use of such services, in addition to the several services launched on the market and the increase in the customer base. The SMS accounted for 71.6% of data revenues in 2005. Average number of SMS messages sent per month in the accumulated total for 2005 was some 38.8 million. |
OPERATING COSTS - TCO |
|||||||||
According to Corporate Law |
|||||||||
Accum. |
|||||||||
R$ million |
4 Q 05 |
3 Q 05 |
Δ% |
4 Q 04 |
Δ% |
2005 |
2004 |
Δ% |
|
Personnel |
(40.7) |
(37.1) |
9.7% |
(37.6) |
8.2% |
(153.5) |
(141.7) |
8.3% |
|
Cost of services rendered |
(78.2) |
(63.8) |
22.6% |
(37.1) |
110.8% |
(277.5) |
(165.6) |
67.6% |
|
Leased lines |
(11.5) |
(11.1) |
3.6% |
(6.2) |
85.5% |
(39.7) |
(25.1) |
58.2% |
|
Interconnection |
(16.1) |
(14.2) |
13.4% |
(13.8) |
16.7% |
(58.9) |
(72.9) |
-19.2% |
|
Rent/Insurance/Condominium fees |
(4.8) |
(5.5) |
-12.7% |
(3.2) |
50.0% |
(15.5) |
(16.0) |
-3.1% |
|
Fistel and other taxes and contributions |
(28.4) |
(27.3) |
4.0% |
(5.1) |
456.9% |
(109.3) |
(12.3) |
788.6% |
|
Third-party services |
(14.9) |
(4.5) |
231.1% |
(8.2) |
81.7% |
(47.9) |
(35.5) |
34.9% |
|
Others |
(2.5) |
(1.2) |
108.3% |
(0.6) |
316.7% |
(6.2) |
(3.8) |
63.2% |
|
Cost of goods sold |
(126.0) |
(92.4) |
36.4% |
(196.0) |
-35.7% |
(498.6) |
(556.0) |
-10.3% |
|
Selling expenses |
(219.1) |
(165.4) |
32.5% |
(119.3) |
83.7% |
(627.8) |
(395.8) |
58.6% |
|
Provision for bad debt |
(113.0) |
(56.2) |
101.1% |
(19.2) |
488.5% |
(224.6) |
(68.3) |
228.8% |
|
Third-party services |
(102.4) |
(91.4) |
12.0% |
(90.9) |
12.7% |
(367.2) |
(296.5) |
23.8% |
|
Others |
(3.7) |
(17.8) |
-79.2% |
(9.2) |
-59.8% |
(36.0) |
(31.0) |
16.1% |
|
General & administrative expenses |
(26.8) |
(33.9) |
-20.9% |
(26.9) |
-0.4% |
(108.2) |
(84.1) |
28.7% |
|
Other operating revenues (expenses) |
37.7 |
(4.0) |
n.a. |
13.1 |
187.8% |
43.4 |
24.0 |
80.8% |
|
Total costs before depreciation / amortization |
(453.1) |
(396.6) |
14.2% |
(403.8) |
12.2% |
(1,622.2) |
(1,319.2) |
23.0% |
|
Depreciation and amortization |
(70.3) |
(67.9) |
3.5% |
(58.2) |
20.8% |
(262.8) |
(210.0) |
25.1% |
|
Total operating costs |
(523.4) |
(464.5) |
12.7% |
(462.0) |
110.8% |
(1,885.0) |
(1,529.2) |
23.3% |
Personnel Cost | The increase in personnel cost in the comparison between the accumulated total for 2005 and 2004 is due to salary adjustments arising out of the November/2004, the investments in training and the incentive campaigns for the selling team. The positive variation between 4Q05 and 3Q05 is a result of the collective agreement signed in November/2005 and the reflexes in provisions and benefits. |
Cost of Services Rendered | The 110.8% increase in the cost of services rendered by TCO, in 4Q05, when compared to 4Q04, and of 67.6% in the accumulated total for 2005, in relation to 2004, is due to an increase in the number of links and negotiations of connection means as well as the increase in the customer base. The variation recorded in “Fistel and other fees and contributions” in the periods under examination arises out of equalization of TCO’s accounting criteria to the other Group Companies, as well as of the increase in expenses with third-party services, especially plant maintenance and electric power. |
Cost of Goods Sold | Cost of goods sold decreased by 35.7% in relation to 4Q04 and by 10.3% in the comparison between the accumulated total for 2005 and 2004, mostly due to the increase in the number of customer additions, reduced costs and improved mix of handsets, as a result of market conditions. |
Selling Expenses | In 4Q05, selling expenses increased by 83.7% in relation to 4Q04 and by 58.6% in the comparison between the accumulated totals for 2005 and 2004, caused by an increase in expenses with third-party services, especially publicity, commissions, and post-sale “client care”, resulting from the increase in the total traffic recorded in 2005. |
General and Administrative Expenses |
The 20.9% reduction in general and administrative expenses in 4Q05, as compared to 3Q05, is due to the recognition on 3Q05 of a provision for value–added tax. In the accumulated total for 2005, the 28.7% increase over 2004 is due to the increase in the costs of third-party services, especially labor and systems maintenance. |
Other Operating Revenues/ Expenses
| Increase of R$ 41.7 million in the revenue in 4Q05 in relation to the same period of the previous year and increase of R$ 19.4 million in the accumulated total of 2005 over 2004, caused by an extraordinary effect referring to recovery of expenses with taxes and reversal of contingencies provision. |
EBITDA | In the year-to-date figure, the EBITDA (earnings before interests, taxes, depreciation and amortization) was R$ 649.3 million, with 28.6% margin. The variation recorded in the EBITDA in the period reviewed was caused, among other factors, by the drop in the revenue from sale of handsets, partially offset by the reduction in the cost of goods, as well as by the increase in selling costs (PDD and third party), and by the cost of services rendered (Fistel and other fees and contributions and third-party services). |
Depreciation and Amortization | Depreciation and amortization expenses recorded R$ 70.3 million in 4Q05 and R$ 262.8 million in the accumulated total for 2005, representing 3.5% increase in 4Q05 in relation to the previous quarter and 25.1% in the comparison between the accumulated total for 2005 and 2004, due to the investments effected, especially in function of the overlay to the CDMA network and incoming operational assets, as a result of the conclusion of works. |
FINANCIAL REVENUES (EXPENSES) - TCO | |||||||||
According to Corporate Law |
|||||||||
Accum. |
|||||||||
R$ million |
4 Q 05 |
3 Q 05 |
Δ% |
4 Q 04 |
Δ% |
2005 |
2004 |
Δ% |
|
Financial Revenues |
42.3 |
58.4 |
-27.6% |
39.3 |
7.6% |
201.4 |
158.5 |
27.1% |
|
Exchange rate variation / Monetary variation |
(2.1) |
4.7 |
n.a. |
5.0 |
n.a. |
11.0 |
5.1 |
115.7% |
|
Other financial revenues |
52.8 |
59.7 |
-11.6% |
42.8 |
23.4% |
204.9 |
173.9 |
17.8% |
|
(-) Pis/Cofins taxes on financial revenues |
(8.4) |
(6.0) |
40.0% |
(8.5) |
-1.2% |
(14.5) |
(20.5) |
-29.3% |
|
Financial Expenses |
(18.5) |
(18.9) |
-2.1% |
(27.9) |
-33.7% |
(84.3) |
(96.3) |
-12.5% |
|
Exchange rate variation / Monetary variation |
(2.0) |
2.5 |
n.a. |
(3.2) |
-37.5% |
(7.6) |
(25.6) |
-70.3% |
|
Other financial expenses |
(16.1) |
(15.8) |
1.9% |
(10.6) |
51.9% |
(56.4) |
(49.7) |
13.5% |
|
Gains (Losses) with derivatives transactions |
(0.4) |
(5.6) |
-92.9% |
(14.1) |
-97.2% |
(20.3) |
(21.0) |
-3.3% |
|
Net Financial Income |
23.8 |
39.5 |
-39.7% |
11.4 |
108.8% |
117.1 |
62.2 |
88.3% |
Net Financial Revenues (Expenses) | Net financial revenues in 4Q05 recorded a reduction of R$ 15.7 million when compared to 3Q05. Such result was due to the positive effect in 3Q05 of the discount of R$ 7.3 million obtained in the advanced payment of the tax incentive with the State of Goiás Treasury Department (Teleproduzir) and the decrease in the interest rate for the period earned from the company’s financial investments (4.74% in 3Q05 and 4.31% in 4Q05). Other effects which caused such reduction were the increase of R$ 2.4 million, in relation to 3Q05, in the expenses with Pis/Cofins taxes on Interest on Own Capital referring to fiscal year 2005, and the increase in the monetary adjustment occurred in 4Q05, which is assessed on Contingencies (Telebrás spin-off). The increase in the interest rate of 2005 over 2004 (16.17% in 2004 and 19.0% in 2005), together with the increase in the net cash position of the Company, caused an increase in the net financial revenue over 2004 of R$ 54.9 million. |
Net Profit | The net profit in the quarter was R$ 63.2 million, and in the accumulated total for the year was R$ 339.1 million. |
LOANS AND FINANCING - TCO |
||||||
CURRENCY |
||||||
Lenders (R$ million) |
R$ |
US$ |
URTJLP * |
UMBND ** |
Total |
|
Financial institutions |
1.3 |
23.7 |
77.3 |
6.6 |
108.9 |
|
Total |
1.3 |
23.7 |
77.3 |
6.6 |
108.9 |
|
Exchange rate used |
2.341 |
1.925 |
0.045 |
|||
Payment Schedule - Long Term |
||||||
2007 |
0.8 |
- |
35.0 |
3.1 |
39.0 |
|
as from 2007 |
0.0 |
- |
2.9 |
0.3 |
3.2 |
|
Total |
0.8 |
0.0 |
38.0 |
3.4 |
42.2 |
NET DEBT - TCO |
||
Dec 31. 05 |
Sep 30. 05 |
|
Short Term |
66.7 |
78.2 |
Long Term |
42.2 |
62.5 |
Total debt |
108.9 |
140.7 |
Cash and cash equivalents |
(894.5) |
(1,066.5) |
Derivatives |
15.2 |
28.2 |
Net Debt |
(770.4) |
(897.6) |
(*) BNDES long term interest rate unit
(**) UMBND - prepared by the BNDES, it is a basket of foreign currencies unit, US dollar predominant
Indebtedness | On December 31, 2005, TCO’s debt related to loans and financings amounted to R$ 108.9 million (R$ 140.7 million on September 30, 2005), 28% of which is nominated in foreign currency. The Company has signed exchange rate hedging contracts thus protecting 100% of its financial debt against foreign exchange volatility, so that the final cost (debt and swap) is reais-referenced. This debt was offset by cash and financial investments (R$ 894.5 million) and by derivative assets and liabilities (R$ 15.2 million payable) resulting in a net cash position of R$ 770.4 million, a 14.2% reduction in relation to September 2005. The payments effected in December 2005 of Interest on Own Capital referring to fiscal year 2004 (R$ 51.1 million) and to Interim Dividends for fiscal year 2005 (R$ 46.4 million), besides the postponement of the maturity dates of some postpaid cycles were the key factors which caused the reduction in TCO’s net cash position in the comparison between 4Q05 and 3Q05. |
CAPEX - TCO |
||||||
R$ million |
Accum |
|||||
4 Q 05 |
3 Q 05 |
4 Q 04 |
2005 |
2004 |
||
Network |
106.7 |
37.2 |
95.2 |
251.3 |
310.1 |
|
Other |
33.4 |
11.6 |
44.0 |
105.7 |
109.2 |
|
Total |
140.1 |
48.8 |
139.2 |
357.0 |
419.3 |
|
% Net Revenues |
24.6% |
8.4% |
22.9% |
15.7% |
19.0% |
Capital Expenditures (Capex) | Capital expenditures of R$ 357.0 million in 2005 are due to the migration from TDMA to CDMA technology (overlay), which started in 2004. In addition, the capital expenditures in 4Q05 were basically due to the following factors: (i) improvement in the consolidation rationalization of the information systems; (ii) maintenance of quality and expansion of the coverage in order to meet the growth of the customer base; and (iii) terminals and technology for meeting the corporate segment. |
Operating Cashflow | The positive operating cash flow of R$ 292.3 million in the accumulated total for 2005 shows TCO has generated funds from its operations to implement its capital expenditures program. |
Capital Market | In 4Q05, the value of TCO’s common shares (ON) and preferred shares (PN) increased by 24.5% and 28.7%, respectively. The Bovespa Index (São Paulo Stock Exchange Index) rose 5.9%. From September to December 2005, the Company’s PN shares were traded in 100% of the floor trading sessions, with an average daily trading volume of R$ 3.9 million. By the end of 4Q05, ON and PN shares were traded at R$ 24.88 and R$ 26.70, respectively. The price of TCO’s level II ADRs increased by 23.8% in the quarter, against an increase of 1.4% in the Dow Jones index. The daily average volume of shares traded in the NYSE during 4Q05 was US$ 1.9 million. The closing price of TCO’s ADRs for the quarter was US$ 11.22. |
Corporate Restructuring | The managements of Telesp Celular Participações S.A. (“TCP”) and Tele Centro Oeste Celular Participações S.A. (“TCO”), in the form and for the purposes of CVM Instructions no. 319/99 and 358/02, informed to the public that their respective Boards of Directors, on December 04, 2005, approved the proposal to be submitted to the shareholders of the Companies, of a corporate restructuring for merger of TCO into TCP. The managements of TCP and TCO consider that the Corporate Restructuring, with the consequent concentration of the shareholders of both Companies in one sole publicly-held company and the transfer of TCO’s shares to TCP, will simplify the present organizational structure, by reducing costs and increasing the equity value for the shareholders, allow their shareholders to hold interest in a company with higher liquidity in the Brazilian and foreign stock exchanges, and make easier the unification, standardization and rationalization of the general management of TCP’s and TCO’s businesses, allowing enhanced synergies between the referred Companies, which, either directly or through the respective operators controlled by them, already use “VIVO brand”. In the Shareholders Meeting of TCP and TCO, held on February 22, 2006, the Corporate Restructure was duly approved and Telesp Celular Participações will be named VIVO PARTICIPAÇÕES S.A. The full contents of the above mentioned terms and conditions may be obtained from our website www.vivo.com.br/ir. |
Social Responsibility |
|
Main Prizes, Awards and Events |
|
Subsequent |
Vivo has launched the digital roaming service in Minas Gerais and in 6 Northeast states. As from 01/30, Vivo postpaid customers who buy a Motorola A840 – GLOBALMOTO handset will have available an automatic digital roaming service in all Brazilian states, in addition to the international roaming in more than 170 countries in the five continents, using the same handset and same Vivo telephone number. |
BALANCE SHEET - TCO |
|||
R$ million |
|||
ASSETS |
Dec 31. 05 |
Dec 31. 04 |
|
Current Assets |
2,205.9 |
1,972.5 |
|
Cash and banks |
15.7 |
57.2 |
|
Temporary cash investments |
878.8 |
894.0 |
|
Net accounts receivable |
716.8 |
477.1 |
|
Inventory |
60.6 |
192.3 |
|
Prepayment to Suppliers |
2.2 |
8.0 |
|
Deferred and recoverable taxes |
440.7 |
274.3 |
|
Prepaid Expenses |
62.1 |
40.0 |
|
Other current assets |
29.0 |
29.6 |
|
Long Term Assets |
437.2 |
501.1 |
|
Deferred and recoverable taxes |
424.9 |
459.8 |
|
Prepaid Expenses |
6.5 |
11.5 |
|
Other long term assets |
5.8 |
29.8 |
|
Permanent Assets |
1,224.5 |
1,130.3 |
|
Investment |
1.3 |
4.2 |
|
Plant, property and equipment |
1,205.2 |
1,104.3 |
|
Deferred assets |
18.0 |
21.8 |
|
Total Assets |
3,867.6 |
3,603.9 |
|
LIABILITIES |
|||
Current Liabilities |
870.6 |
894.3 |
|
Suppliers and Consignment |
476.1 |
475.6 |
|
Taxes, fees and contributions |
112.1 |
102.9 |
|
Interest on own capital |
74.6 |
144.4 |
|
Loans and financing |
66.7 |
102.7 |
|
Contingencies provision |
12.4 |
5.5 |
|
Derivatives transactions |
14.4 |
13.9 |
|
Other current liabilities |
114.3 |
49.3 |
|
Long Term Liabilities |
184.0 |
268.0 |
|
Loans and financing |
42.2 |
123.6 |
|
Contingencies provision |
131.5 |
128.6 |
|
Derivatives transactions |
0.8 |
6.8 |
|
Other long term liabilities |
9.5 |
9.0 |
|
Shareholder's Equity |
2,812.9 |
2,441.5 |
|
Funds for capitalization |
0.1 |
0.1 |
|
Total Liabilities |
3,867.6 |
3,603.9 |
INCOME STATEMENTS - TCO |
|||||||||
According to Corporate Law |
|||||||||
Acumulado em: |
|||||||||
R$ million |
4 Q 05 |
3 Q 05 |
Δ% |
4 Q 04 |
Δ% |
2005 |
2004 |
Δ% |
|
Gross Revenues |
849.3 |
813.9 |
4.3% |
820.0 |
3.6% |
3,171.6 |
2,949.7 |
7.5% |
|
Gross service revenues |
672.5 |
698.7 |
-3.7% |
663.7 |
1.3% |
2,650.6 |
2,462.9 |
7.6% |
|
Deductions – Taxes and others |
(183.5) |
(178.5) |
2.8% |
(158.7) |
15.6% |
(677.9) |
(583.3) |
16.2% |
|
Gross handset revenues |
176.8 |
115.2 |
53.5% |
156.3 |
13.1% |
521.0 |
486.8 |
7.0% |
|
Deductions – Taxes and others |
(96.6) |
(55.6) |
73.7% |
(52.4) |
84.4% |
(222.2) |
(155.9) |
42.5% |
|
Net Revenues |
569.2 |
579.8 |
-1.8% |
608.9 |
-6.5% |
2,271.5 |
2,210.5 |
2.8% |
|
Net service revenues |
489.0 |
520.2 |
-6.0% |
505.0 |
-3.2% |
1,972.7 |
1,879.6 |
5.0% |
|
Subscription and Usage |
290.2 |
309.1 |
-6.1% |
274.0 |
5.9% |
1,124.6 |
981.8 |
14.5% |
|
Network usage |
178.7 |
188.4 |
-5.1% |
220.7 |
-19.0% |
761.9 |
840.1 |
-9.3% |
|
Other services |
20.1 |
22.7 |
-11.5% |
10.3 |
95.1% |
86.2 |
57.7 |
49.4% |
|
Net handset revenues |
80.2 |
59.6 |
34.6% |
103.9 |
-22.8% |
298.8 |
330.9 |
-9.7% |
|
Operating Costs |
(453.1) |
(396.6) |
14.2% |
(403.8) |
12.2% |
(1,622.2) |
(1,319.2) |
23.0% |
|
Personnel |
(40.7) |
(37.1) |
9.7% |
(37.6) |
8.2% |
(153.5) |
(141.7) |
8.3% |
|
Cost of services rendered |
(78.2) |
(63.8) |
22.6% |
(37.1) |
110.8% |
(277.5) |
(165.6) |
67.6% |
|
Leased lines |
(11.5) |
(11.1) |
3.6% |
(6.2) |
85.5% |
(39.7) |
(25.1) |
58.2% |
|
Interconnection |
(16.1) |
(14.2) |
13.4% |
(13.8) |
16.7% |
(58.9) |
(72.9) |
-19.2% |
|
Rent/Insurance/Condominium fees |
(4.8) |
(5.5) |
-12.7% |
(3.2) |
50.0% |
(15.5) |
(16.0) |
-3.1% |
|
Fistel and other taxes and contributions |
(28.4) |
(27.3) |
4.0% |
(5.1) |
456.9% |
(109.3) |
(12.3) |
788.6% |
|
Third-party services |
(14.9) |
(4.5) |
231.1% |
(8.2) |
81.7% |
(47.9) |
(35.5) |
34.9% |
|
Others |
(2.5) |
(1.2) |
108.3% |
(0.6) |
316.7% |
(6.2) |
(3.8) |
63.2% |
|
Cost of handsets |
(126.0) |
(92.4) |
36.4% |
(196.0) |
-35.7% |
(498.6) |
(556.0) |
-10.3% |
|
Selling expenses |
(219.1) |
(165.4) |
32.5% |
(119.3) |
83.7% |
(627.8) |
(395.8) |
58.6% |
|
Provision for bad debt |
(113.0) |
(56.2) |
101.1% |
(19.2) |
488.5% |
(224.6) |
(68.3) |
228.8% |
|
Third-party services |
(102.4) |
(91.4) |
12.0% |
(90.9) |
12.7% |
(367.2) |
(296.5) |
23.8% |
|
Others |
(3.7) |
(17.8) |
-79.2% |
(9.2) |
-59.8% |
(36.0) |
(31.0) |
16.1% |
|
General & administrative expenses |
(26.8) |
(33.9) |
-20.9% |
(26.9) |
-0.4% |
(108.2) |
(84.1) |
28.7% |
|
Other operating revenue (expenses) |
37.7 |
(4.0) |
n.a. |
13.1 |
187.8% |
43.4 |
24.0 |
80.8% |
|
EBITDA |
116.1 |
183.2 |
-36.6% |
205.1 |
-43.4% |
649.3 |
891.3 |
-27.2% |
|
Margin % |
20.4% |
31.6% |
-11.2 p.p. |
33.7% |
-13.3 p.p. |
28.6% |
40.3% |
-11.7 p.p. |
|
Depreciation and Amortization |
(70.3) |
(67.9) |
3.5% |
(58.2) |
20.8% |
(262.8) |
(210.0) |
25.1% |
|
EBIT |
45.8 |
115.3 |
-60.3% |
146.9 |
-68.8% |
386.5 |
681.3 |
-43.3% |
|
Net Financial Income |
23.8 |
39.5 |
-39.7% |
11.4 |
108.8% |
117.1 |
62.2 |
88.3% |
|
Financial Revenues |
42.3 |
58.4 |
-27.6% |
39.3 |
7.6% |
201.4 |
158.5 |
27.1% |
|
Exchange rate variation / Monetary variation |
(2.1) |
4.7 |
n.a. |
5.0 |
n.a. |
11.0 |
5.1 |
115.7% |
|
Other financial revenues |
52.8 |
59.7 |
-11.6% |
42.8 |
23.4% |
204.9 |
173.9 |
17.8% |
|
(-) Pis/Cofins taxes on financial revenues |
(8.4) |
(6.0) |
40.0% |
(8.5) |
-1.2% |
(14.5) |
(20.5) |
-29.3% |
|
Financial Expenses |
(18.5) |
(18.9) |
-2.1% |
(27.9) |
-33.7% |
(84.3) |
(96.3) |
-12.5% |
|
Exchange rate variation / Monetary variation |
(2.0) |
2.5 |
n.a. |
(3.2) |
-37.5% |
(7.6) |
(25.6) |
-70.3% |
|
Other financial expenses |
(16.1) |
(15.8) |
1.9% |
(10.6) |
51.9% |
(56.4) |
(49.7) |
13.5% |
|
Gains (Losses) with derivatives transactions |
(0.4) |
(5.6) |
-92.9% |
(14.1) |
-97.2% |
(20.3) |
(21.0) |
-3.3% |
|
Non-operating revenue/expenses |
(2.9) |
0.0 |
n.a. |
(7.0) |
-58.6% |
0.1 |
(9.1) |
n.a. |
|
Taxes |
(3.5) |
(62.3) |
-94.4% |
(21.7) |
-83.9% |
(164.6) |
(224.1) |
-26.6% |
|
Minority Interest |
0.0 |
0.0 |
n.a. |
0.0 |
n.a. |
0.0 |
(3.2) |
n.a. |
|
Net Income |
63.2 |
92.5 |
-31.7% |
129.6 |
-51.2% |
339.1 |
507.1 |
-33.1% |
VIVO – Investor Relations |
Charles E. Allen
|
Janaina São Felicio |
Telephone: +55 11 5105-1172 Information available at the website: http://www.vivo.com.br/ri |
This press release contains forecasts of future events. Such statements are not statements of historical fact, and merely reflect the expectations of the company's management. The terms "anticipates," "believes," "estimates," "expects," "forecasts," "intends," "plans," "projects", "aims" and similar terms are intended to identify these statements, which obviously involve risks or uncertainties which may or may not be foreseen by the company. Accordingly, the future results of operations of the Company may differ from its current expectations, and the reader should not rely exclusively on the positions taken herein. These forecasts speak only of the date they are made, and the company does not undertake any obligation to update them in light of new information or future developments. |
GLOSSARY |
Financial Terms: CAPEX – Capital Expenditure. Technology and Services 1xRTT – (1x Radio Transmission Technology) – It is the CDMA 2000 1x technology which, pursuant to the ITU (International Telecommunication Union). and in accordance with the IMT-2000 rules is considered 3G (third generation) Technology. |
Operating indicators: Gross additions – Total of customers acquired in the period.
|
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: March 03, 2006
TELE CENTRO OESTE CELLULAR HOLDING COMPANY |
||
By: |
/S/ Paulo Cesar Pereira Teixeira
|
|
Paulo Cesar Pereira Teixeira
Investor Relations Officer |
This press release may contain forward-looking statements. These statements are statements that are not historical facts, and are based on management's current view and estimates of future economic circumstances, industry conditions, company performance and financial results. The words "anticipates", "believes", "estimates", "expects", "plans" and similar expressions, as they relate to the company, are intended to identify forward-looking statements. Statements regarding the declaration or payment of dividends, the implementation of principal operating and financing strategies and capital expenditure plans, the direction of future operations and the factors or trends affecting financial condition, liquidity or results of operations are examples of forward-looking statements. Such statements reflect the current views of management and are subject to a number of risks and uncertainties. There is no guarantee that the expected events, trends or results will actually occur. The statements are based on many assumptions and factors, including general economic and market conditions, industry conditions, and operating factors. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations.