THE TIM Participacoes released the financial results for the third quarter of 2020. The operator recorded a 20.9% drop in normalized net income, although net revenue increased by 1.2% compared to the same period in 2019. The company was able to add customers from the postpaid and fixed internet TIM Live, which continues with most modems connected with copper technology.
TIM financial results in the 3rd quarter of 2020
These are the main financial highlights of the third quarter of 2020, with the annual comparison:
|Indicator||3rd quarter of 2020||3rd quarter of 2019||Difference|
|Normalized net income||R $ 390 million||R $ 493 million||-20.9%|
|Normalized EBITDA (earnings before interest, taxes, depreciation and amortization)||R $ 2.07 billion||R $ 2.05 billion||+ 0.8%|
|Normalized EBIDTA margin||47.3%||47.4%||-0.2 p.p|
|Net Revenue||R $ 4.38 billion||R $ 4.33 billion||+ 1.2%|
|Normalized cost of operation||R $ 2.31 billion||R $ 2.28 billion||+ 1.5%|
|Capex (investments)||R $ 850 million||R $ 924 million||-8%|
TIM grows again in postpaid
The mobile segment is the most important in TIM’s finances and accounts for R $ 3.3 billion in service revenue, up 0.3% year-on-year. The company resumed postpaid additions, with a 2.3% growth in the base. Prepaid continues to shrink, down 11.6%.
In general, TIM reduced the total number of chips by 6.2%, which is justified by the migration from pre to post and cleaning the customer base that does not recharge. As a result, ARPU (average monthly revenue per user) reached R $ 25.40, an increase of 6.3% in the year.
Another indicator celebrated by the operator is the prepaid ARPU, which grew 9.4% in the year. The operator has invested in actions that encourage recharges, such as the TIM + Vantagens program. In the next quarter, it will be possible to see the impact of a recent action: the operator decided to discontinue the Infinity Pré plan and migrate customers to TIM Pré Top, with recurring collection and immediate consumption of the balance.
In September, TIM readjusted its consumers’ plans, and this had a limited impact on the balance sheet for the third quarter. At the end of July, the company reformulated the TIM Black postpaid portfolio; she says that this brought “good performance in the acquisition of new lines”, with an increase of 418 thousand net additions in the period.
Copper is still the majority on the fixed internet TIM Live
The TIM Live fixed internet service had 37 thousand new accesses in the quarter and 133 thousand in the last year. The company ended the period with the presence of broadband in 32 locations, 30 of which with optical fiber (FTTH).
Even so, metallic cable connections remain the majority at TIM: data from September 2020 from Anatel show that the operator had 362 thousand accesses with xDSL technology, which represents 56.4% of all broadband modems.
The presence of fiber is disappointing in São Paulo (SP), a municipality where TIM concentrates 282 thousand fixed broadband accesses: 77.1% are still connected to copper. In Rio de Janeiro (RJ), history repeats itself: of the 137 thousand modems from TIM Live, 76.9% use xDSL technology.
In October, TIM Live started operations in Guarulhos (SP). In the city, the company will compete with Claro, Vivo and several small operators.
TIM took 800 thousand accounts to C6 Bank
TIM started a partnership with C6 Bank in 2020, and this sent new customers to fintech: the operator says that the offers of mobile plans launched together with the bank led to the opening of 800 thousand accounts.
For those who use TIM, reloading or paying the invoice with C6 Bank yields advantages:
In addition to the internet bonus, TIM’s partnership with the bank brings other advantages, such as better fixed income investment rates, a global account with no fees and an exemption from annuity on the C6 Carbon Mastercard Black card for 6 months.