STOCKHOLM (Reuters) - Emerging markets focused telecoms and media group Millicom stood by its outlook for 2014, excluding a recent acquisition, as it posted forecast-beating third-quarter core profit and mobile customer intake on Wednesday.
As mobile markets mature in Latin America and Africa, Millicom is expanding into fields like mobile financial services, cable TV and online ventures like African home shopping site Jumia.
While growing faster than mobile telephony, these businesses have lower margins, as has Colombian cable firm UNE which Millicom bought this year. The new fields are pushing up revenue growth but dragging down profitability.
In the first nine months this year, Millicom's like-for-like sales rose by 8.7 percent, much faster than the 4.6 percent in the year-ago period. Meanwhile, its core profit margin dropped by 3.4 percentage points to 33.3 percent.
Earnings before interest, tax, depreciation and amortisation (EBITDA) were $549 million (340.7 million pounds) in the third quarter versus a mean forecast of $540 million in a Reuters poll of analysts and $487 million in the year-ago quarter.
Millicom said its number of mobile customers rose by 1.46 million, higher than the poll forecast of 1.15 million.
The Latin America and Africa-focused operator said it expected like-for-like 2014 sales to grow at a medium to high single digit rate and a core profit margin at around 35 percent in 2014.
The forecast excluded its acquisition of Colombian cable company UNE, which was finalised in August and has lower margins than Millicom.
(Reporting by Sven Nordenstam and Olof Swahnberg; Editing by Alistair Scrutton)