Venezuela's CANTV seeks 19 pct price increase

Reuters 03.28.03, 3:30 PM ET

CARACAS, Venezuela, March 28 (Reuters) - Venezuela's CANTV <TDVd.CR>, the nation's largest telecommunications company, is seeking government approval for new tariffs that will increase telephone charges by about 19 percent this year, the company's president said on Friday. CANTV, whose principal shareholder is U.S. No. 1 local telephone company Verizon Communications Inc. (nyse: VZ - news - people), has not defined the new tariffs, as Venezuelan residential charges are still frozen by presidential decree as part of price controls intended to curb inflation. "We are hoping for approval of the new tariffs, which have been worked out with Conatel (state telecommunications commission), CANTV President Gustavo Roosen told Reuters during a company shareholder meeting. Roosen said the charges would be increased on average about 19 percent for the year. CANTV, the domestic market leader in telecoms and Internet access, last year raised its charges by an average of 25 percent. During their assembly, CANTV shareholders approved an ordinary dividend of 71 bolivars per share, or 497 bolivars per American Depositary Share, to be paid on April 23. Shareholders also authorized the board to issue up to 150 billion bolivars (about $94 million at the current exchange rate of 1,600 bolivars to the dollar) in commercial paper coming due June, 30, 2004. Last year, the company, the largest presence on the Venezuelan stock market, reported a 27.7 percent fall in net profits to 61.03 billion bolivars as its results were undercut by inflation and currency adjustments. CANTV fourth-quarter results were also battered by a strike started in December by opposition leaders trying to oust President Hugo Chavez. CANTV reported a quarterly loss of $2 million compared with profits of $22 million in the same period in 2001. Roosen refused to give detailed first-quarter forecasts but he said he believed the results would be better than the company had been expecting. He said the company was now focused on significantly reducing costs and maintaining cash flow.