Telefónica's HispAm operations expected to contribute US$1bn debt reduction

The agreements with KKR to create neutral fiber optic networks in Chile and Colombia and the forthcoming approval of the sale of Telefónica Costa Rica will contribute to a debt reduction of US$1bn in 2021, said Laura Abasolo, head of finances, control and corporate development at Spain’s Telefónica during an investor conference call.

"We found a good formula with [infrastructure unit] InfraCo's operations to accelerate growth, capture the increase in bandwidth and monetize our brownfield," said Abasolo.

The company also plans to reach an agreement to create a neutral fiber network in Peru.

Telefónica continues to seek opportunities to moderate its exposure in the region.

Meanwhile, it is working to improve its financial situation and on an operating model that allows it to boost its performance, gain agility and reduce costs.

For the first time in 15 quarters, Latin America reported revenue and Oibda growth measured in euros.

Telefónica Hispanoamérica posted Q2 revenues of 2.01bn euros (up 6.7% year-on-year), while Oibda reached 373mn euros (up 3.2%).

The company achieved 488,000 net additions in the mobile business during the second quarter, reaching 93.4mn accesses in Latin America. Colombia achieved a quarterly record with 202,000 new clients.

Net broadband additions grew by more than 100,000, driven by fiber optics. Telefónica Hispanoamérica ended June with 5.6mn broadband accesses, of which 3.88mn correspond to fiber to the home.

Telefónica Hispanoamérica reported 2.8mn pay TV accesses.

5G AGRO PROJECT IN BRAZIL

Brazil is one of the markets that Telefónica marked as a priority.

Along with the results release, it was announced that Vivo Empresas, Telefónica's corporate segment in Brazil, was selected as a technological partner for the 5G Smart Farming project, an initiative of the São Martinho agroindustrial group and Sweden’s Ericsson.

The companies plan to offer 4G and 5G connectivity to agricultural producers using 700MHz and 3,500MHz frequencies.

Telefónica's Vivo brand will add experience in IoT application development, the company said.