Algar Telecom
Main Indicators for 2018
GRI 102-7
The Company arrived at the Brazilian Northeast, in 18 locations, through new regional offices in the states of Alagoas, Ceará, Paraíba, Rio Grande do Norte and Sergipe, and expanded the operations in the Southeast region, arriving to Espírito Santo.
The Monet cable started operating with around 11,000 km of submarine optical cables, connecting the cities of Praia Grande (SP) and Fortaleza (CE) to Boca Raton (Florida, United States).
Cemig Telecom’s assets in the states of Bahia, Ceará, Pernambuco and Goiás were acquired, increasing our network by around 1,200 km.
EBITDA margin reached 42% in the Telecom segment and 13% in the Tech segment.
Corporate customers grew 24% and B2B gross revenue increased by 8%.
The number of B2C broadband customers with speeds higher than 10 Mbps reached 58% of the total.
Algar Telecom won the 20th ABRASCA Award, in the category of Publicly Held Company with Net Revenue of less than R$3 billion, and the ANEFAC/FIPECAFI/SERASA Transparency Award in the category of Company with Net Revenue up to R$5 billion. Also, the Company was elected for the 6th consecutive year as the most sustainable company in the telecommunications industry by Guia Exame de Sustentabilidade (Exame Sustainability Guide).
Algar Tech, subsidiary responsible for the Tech/BPO segment – IT Management, was recognized as the 10th most innovative company in Brazil, the 1st in the Digital Industry – IT and Telecom category, in the ranking of the 100+ Innovative IT use by IT MEDIA and PWC.
The Company’s credit rating increased from “brAA-” to “brAAA” with a stable outlook by Standard & Poor’s rating agency.
| B2B Operating Data (units) | 2014* | 2015 | 2016 | 2017 | 2018 | Δ 2017/2018 |
| Number of Customers | N/A | 100,015 | 108,686 | 95,377 | 104,791 | 10% |
| Corporate | N/A | 7,884 | 10,000 | 10,919 | 13,550 | 24% |
| Small and Micro Enterprises (SMEs) | N/A | 92,131 | 98,686 | 84,458** | 91,241 | 8% |
*In 2014, the Company adopted different criteria for segmentation, which makes the direct comparison impossible.
**From 2016 to 2017, the decreased number of SME clients was due to the relocation of 23,724 clients in January 2017, which started to be supported by B2C. The purpose of this change was to provide a customer service channel that better met the needs of these customers.
| Operational Data* (´000 units) | 2014 | 2015 | 2016 | 2017 | 2018 | Δ 2017/2018 |
| Data | 399 | 435 | 475 | 515 | 543 | 6% |
| Landlines | 714 | 722 | 733 | 756 | 736 | (3%) |
| Mobile | 1,205 | 1,298 | 1,342 | 1,313 | 1,290 | (2%) |
| Paid TV | 88 | 76 | 97 | 98 | 83 | (15%) |
* Data published by Anatel. The information includes the concession area and cities operated in the H band. The data includes retail customers and B2B customers.
| Consolidated Financial Indicators (R$ million) | 2014 | 2015 | 2016 | 2017 | 2018 | Δ 2017/2018 |
| Gross Revenue | 2,850 | 3,092 | 3,314 | 3,557 | 3,683 | 3% |
| Net Revenue | 2,238 | 2,418 | 2,545 | 2,716 | 2,867 | 6% |
| Consolidated EBITDA | 543 | 642 | 710 | 780 | 968 | 24% |
| Consolidated EBITIDA Margin | 24% | 27% | 28% | 29% | 34% | 5p.p. |
| EBITDA Telecom Segment | 450 | 537 | 634 | 717 | 846 | 18% |
| EBITIDA Telecon Margin | 30% | 33% | 36% | 38% | 42% | 4p.p. |
| EBITDA Tech – BPO/IT Management Segment | 93 | 105 | 76 | 63 | 122 | 93% |
| EBITIDA Margin | 12% | 13% | 9% | 7% | 13% | 6p.p. |
| Net Profit | 142 | 154 | 184 | 230 | 316 | 38% |
| Net Margin | 6% | 6% | 7% | 8% | 11% | 3p.p. |
| Investments* | 572 | 501 | 508 | 542 | 733 | 35% |
| Net Debt** | 1,118 | 1,182 | 1,263 | 1,401 | 1,547 | 10% |
| Net Debt/EBITDA (times) | 2.1 | 1.8 | 1.8 | 1.8 | 1.7 | – |
*The amount of investments in the Tech – BPO/ IT Management Segment for 2016 has been restated.
**Net debt is calculated based on the following balances: R$7.1 million in 2015, R$7.6 million in 2016, R$5.9 million in 2017 and R$4.7 million in 2018, for the purchase of Optitel (posted in “Notes payable – current liabilities” and “Other obligations – non-current liabilities”) and, in 2017, the balance of R$41.6 million and, in 2018, R$25.6 million posted in “Liability for purchase of a corporate interest”.
| Corporate Indicators | 2014 | 2015 | 2016 | 2017 | 2018 | Δ 2017/2018 |
| Employees (Staff) | 17,573 | 16,187 | 16,115 | 15,646 | 16,133 | 3% |
| Men | 8,955 | 8,371 | 8,616 | 8,650 | 8,860 | 2% |
| Women | 8,618 | 7,816 | 7,499 | 6,996 | 7,243 | 3% |
| Hours of Training (thousands) | 690 | 865 | 1,045 | 838 | 2,402 | 187% |
| Average Number of Training Hours per Employee | 39 | 53 | 65 | 54 | 149 | 176% |
| Environmental Indicators (tCO2e) | 2014 | 2015 | 2016 | 2017 | 2018 | Δ 2017/2018 |
| Direct Greenhouse Gas Emissions – Scope 1 | 3,840 | 4,115 | 4,961* | 5,930 | 5,393 | (9%) |
| Indirect Greenhouse Gas Emissions – Scope 2 | 12,008 | 11,302 | 7,214* | 8,061 | 6,484 | (20%) |
| Total Biogenic Emissions | 5,635 | 6,459 | 5,509* | 5,430 | 6,469 | 19% |
*Numbers corrected during an audit after the publication of the 2016 Sustainability Report.
**Refers to the following greenhouse gases (GHGs) regulated under the Kyoto Protocol: CO2, CH4, N2O and the hydrofluorocarbons family (HFCs).
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