SAO PAULO , Feb. 9, 2011 /PRNewswire-FirstCall/ -- Net Servicos de Comunicacao S.A. (BM&FBovespa: NETC3 and NETC4;Nasdaq: NETC; and Latibex: XNET), the largest cable company in Latin America with integrated services of Pay TV ("NET"), Digital Video ("NET Digital"), bidirectional broadband internet access ("NET Virtua") and voice ("NET Fone via Embratel"), hereby announces its fourth quarter (4Q10) and 2010 results.
NET achieved excellent results in 2010 as a result of its accelerated growth strategy and focus on service quality. With the Brazilian population demanding increasingly rapid internet connections, the Company adapted Net Virtua, the most awarded internet access service in Brazil, to speeds of between 500Kbps and 100Mbps.
The Company also led the high-definition content market. NET has the largest number of subscribers to this service, thanks to its extensive range of content that caters to the most diverse of client needs.
NET also maintained its leadership of the fixed-line portability segment with Net Fone Via Embratel product.
NET closed 2010 with a Pay TV subscriber base of 4,212,000 clients, 14% up on the 3,690,000 recorded at the end of 2009. The Broadband base totaled 3,524,000 clients at year-end, 22% more than the 2,882,000 in 2009. Lines in service ended the year at 3,153,000, a 23% improvement over the 2,557,000 reported at the close of 2009.
Net Revenue came to R$1,454.0 million in 4Q10, 18.0% up on the R$1,234.7 million posted in 4Q09. In the year as a whole, net revenue grew by 17%, from R$4,613.4 million, in 2009, to R$5,405.7 million, chiefly driven by the expansion of the subscriber base.
Operating Costs totaled R$689.0 million in 4Q10, 13% up on the 4Q09 figure of R$611.9 million, and R$2,579.6 million in the full year, 13% more than the R$2,274.9 million posted in 2009, mainly due to business growth. As a percentage of net revenue, operating costs fell from 49.6% in 4Q09 to 47.4% in 4Q10 and from 49.3% in 2009 to 47.7% in 2010.
Selling, General and Administrative Expenses (SG&A) stood at R$312.4 million in 4Q10, 17% up on the R$266.1 million recorded in 4Q09, and closed the year at R$1,225.2 million, 16% higher than the 2009 total of R$1,055.5 million, primarily due to increased expenses with IT and sales. As a percentage of net revenue, however, these expenses declined from 21.6% in 4Q09 to 21.5% in 4Q10 and from 22.9% in 2009 to 22.7% in 2010.
EBITDA (earnings before interest, tax, depreciation and amortization) amounted to R$446.2 million in 4Q10, with an EBITDA margin of 31%, a 28% improvement over the 4Q09 figure of R$347.9 million. In annual terms, EBITDA moved up by 26% from R$1,242.2 million in 2009 to R$1,559.3 million in 2010.
The Company closed 4Q10 with Net Income of R$133.0 million, versus R$137.9 million in 4Q09. In 2010 as a whole, net income came to R$307.1 million, compared to R$735.9 million in 2009.
Capex totaled R$1.2 billion in 2010, 13% up on 2009, with the variable portion of Capex, which is allocated to client acquisitions, residential installations and equipment purchases, representing 58% of the total. The remainder was allocated to maintenance and network and bidirectional expansion projects.
Gross debt, which includes principal and incurred interest, closed 4Q10 at R$2,178.2 million. Cash and Cash Equivalents totaled R$821.6 million at the end of 4Q10. Net Debt came to R$1,356.7 million, versus the 4Q09 figure of R$1,183.2 million, while the Net Debt to EBITDA ratio fell from 0.95x to 0.87x in the same period, reflecting the continuous improvement of the Company's financial situation and its healthy indebtedness level.
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SOURCE Net Servicos de Comunicacao S.A.