With respect to the Company’s financial results, we reached our projected revenue target for 2019, which grew 11% compared to the previous year to reach Ps. 21,615 million. Consolidated EBITDA reached Ps. 10,257 million, an increase of 9% compared to 2018 at a margin of 47.5%, while EBITDA for cable operations was Ps. 9,535 million, an increase of 7% compared to 2018 at a margin of 49.7%.
We activated new metropolitan rings in the Bajio region and a new one towards the border
In terms of CAPEX, we invested a total of Ps. 6,535 million in 2019, which represented 30.2% of our 2019 revenues, in line with the target for this period.
We activated new rings in the Bajio region, from Guadalajara to Veracruz, passing through Leon, Queretaro, Toluca and Morelia and reaching Puebla, as well as new fiber routes to the border city of McAllen, crossing Saltillo and Monterrey, which together with our more than 400 hubs and sites, makes us one of the main infrastructure and telecommunications network operators in Mexico.
In 2019 we began installing a submarine cable in the region of Baja California that will connect the peninsula with the rest of the country, providing video, voice and high capacity data, services that are currently limited. The construction phase is almost finished, so we will be starting its operation in the first months of 2020. This will bring great benefits to the region thanks to a significant improvement in Internet access speeds, as well as savings for Megacable and better prices for our subscribers in Baja California.
Breakdown by business segment
At the end of 2019, the Video segment grew by 1% (23 thousand net adds) closing the period with a total of 3,224,798 subscribers. Segment revenues increased 10% to close at Ps. 8.962 billion, while service ARPU grew 8% compared to the end of 2018.
We reached more than 3.2 million subscribers in the Video segment; 1% more than in FY 2018.
The Xview platform continued to attract subscribers with great success, registering 384 thousand net additions during the year and a total of 827 thousand subscribers, representing an 87% growth over the previous year.
We are currently developing the second generation of our Xview platform, which will include all the functionality of the Android TV platform and is expected to be launched in the second half of 2020. In addition, we are entering into additional agreements with various partners to make more time available on the platform.
We are confident that this new upgrade will complement our goal of providing a better experience for our subscribers, as they will no longer need to be connected to different platforms to view content, but will instead have recommendations on the best content available on the platforms provided by our search engine.
At the close of 2019, we reached a total of 3,097,628 subscribers, representing 155 thousand net additions or a 5% growth, while annual revenues for this service reached Ps. 6,622 million, a 9% increase compared to 2018. Finally, Internet ARPU grew 8% at the end of the period.
Innovation and quality of service continue to be a hallmark of our cable segment. Thus, in 2019 we began to offer bundles with speeds of 350 megabytes, 500 megabytes and up to 1 gigabyte to the residential market, responding to market demand for greater bandwidth capacity.
Internet service will become the cornerstone for telecommunications bundling in the future, so Megacable has ensured that its network is on par with the evolution of the way content is consumed, continuously investing in its infrastructure and in new technologies to guarantee a better user experience.
We reached nearly 3.1 million subscribers in the Internet segment, an increase of5.2% over the previous year.
The number of subscribers in this segment registered a growth of 18%, reaching 2,130,538; that is, 318 thousand net additions in comparison with 2018.
The revenue of the Telephony segment had a 4% decrease in the year; this was due to the update of the revenue allocation policy implemented as of 2019 intended to better reflect the value given to this service in the market. As a result, ARPU per service decreased by 3% compared to the previous year.
Our product mix reached 52% of the triple-play subscriber base compared to 44% the previous year, again as a result of our successful bundling strategy.
It is worth mentioning that at the end of 2019, we successfully launched a new Mobile service offering. The first results of our MVNO service with Altán are expected in 2020.
We achieved318 thousandnet adds in the Telephony sector, reaching more than2.1million subscribers: 17.5% increase over last year’s results.
TELECOM CORPORATE SEGMENT
Revenues for the Corporate Telecom segment were Ps. 3,934 million, showing an annual growth of 25% compared to 2018, as a result of the strong performance of Ho1a, Metrocarrier and MCM, which all grew 64%, 19% and 9%, respectively.
The synergies between Ho1a and Metrocarrier continue to be the driving force behind the growth of the Corporate segment and are complemented by the investment in infrastructure.
We are confident that we are on the right track regarding our investment project in Mexico for the acquisition of subscriber terminal equipment and kilometer construction. These investments will help us to improve our network capacity and will allow us to make significant savings in network maintenance and operation in the short term.
Our business partners are an important part of Megacable’s success, so in 2019 we increased the cities we cover with our MegaTEC tour. Throughout the tour we held events in the most important cities of the country and invited our technological partners to present our solutions to the most important companies and the government sector. In 2020, the tour will arrive in Baja California as part of the inauguration of our submarine cable service.
In the field of employment there are four guidelines that govern the actions of Megacable: attracting the best talent, increasing staff retention, training employees in a culture of service and having a more efficient organization.
Our team of more than 21,262 employees has been fundamental to the success of the company; for this reason we maintain a human capital development and training program for both administrative and operational personnel focused on certification in the use of the technologies on which we rely. We also provide constant safety training to our service technicians; to this end we have a Training Policy and an ambitious program that includes not only work skills, but also family and personal development.
We remain committed to striving for excellence in our services to generate value for our shareholders, collaborators, and clients, and to be a more profitable company for our investors.
I wish to convey my most heartfelt thanks to our Board of Directors and Management Team for their constant support in achieving our goals and success, to our shareholders, suppliers and customers for the trust they have placed in us, and to our collaborators, who are the driving force behind our Company.
More than$4.3billion pesos of
revenue in the
Corporate Telecom Segment in 2019.
Enrique Yamuni RoblesCHIEF EXECUTIVE OFFICER
Manuel Urquijo BeltránSECRETARY OF THE BOARD