Telefónica Brazil aims to reach 29 million homes with fiber optic by 2024, a 58.4% increase

RIO DE JANEIRO, BRAZIL – Telefónica Brazil aims to expand its footprint to 29 million real estate units passed by fiber optic in Brazil.

According to a presentation to analysts, the company would thus increase its fiber footprint by 58.4% in just over three years from the 18.9 million real estate units it had at the end of the third quarter of 2021.

The company has 5.4 million fiber-optic accesses, 23.8% of its user base, and aims to grow this percentage to 30%.

Telefónica’s goal is to accelerate deployments to compensate for the low relative penetration of broadband access in Brazil compared to other OECD countries.

The Spanish company has a strategy based on organic development and partnerships to meet its objectives.

Thus, Telefónica will deploy organically through Vivo up to 22 million accesses in the regions considered ‘premium’ by the group due to the possibilities of generating a higher return on investment.

At the same time, FiBrasil, the vehicle formed in equal parts with Caisse de dépôt et placement du Québec (CDPQ), expects to reach 6.4 million real estate units in medium-sized cities outside the state of São Paulo in the same period.

In addition, Telefónica has partnerships with American Tower and other infrastructure companies to deploy another 800,000 real estate units in the state of Minas Gerais, which will be built and operated by these partners.

In addition, it also participates in alliances with small partners in areas where Vivo does not offer broadband services through Terra.

In terms of mobile networks, the company has shown its confidence in the potential of 5G and in the successful resolution of the auction of Oi’s mobile assets, which would provide the group with an additional 10.5 million customers.

Telefónica invested last November 1.125 billion Brazilian reais (US$ 198 million) in the auction of 4G and 5G frequencies in the country.

SHAREHOLDER REMUNERATION

According to that filing, during 2021, Telefónica Brazil approved shareholder remuneration of 5.823 billion reais (US$ 1029 million).

To this must be added 426 million reais (more than US$ 75 million) in treasury stock. These amounts put shareholder remuneration at the highest levels since 2017.

Telefónica, as a group, is the main shareholder of its Brazilian company with 73.58% of the shares, so it is entitled to 4.284 billion reais (more than US$ 757 million).

The operator has also been optimistic about the future improvement of fiscal conditions for the telecommunications sector in the country before 2024 and expects a favorable outcome in the arbitration with the Brazilian regulator for the failure to update some concessions since 1998.