(Adds impact on stock index, comment from executive)
MEXICO CITY, April 27 Shares in Mexican
broadcaster Grupo Televisa slid more than 7 percent
on Thursday before paring losses after it reported a drop in
first-quarter advertising sales, dragging on Mexico's stock
Grupo Financiero Banorte changed its outlook for the stock
to "hold" from "buy" on Thursday, noting the company's weak
sales and its slowdown in revenues from cable television.
Televisa's shares were down more than 5 percent in
mid-morning trading, and Mexico's IPC stock index had slipped
Televisa, the world's largest provider of Spanish-language
content, reported a 7.8 percent drop in advertising sales in the
first quarter from the same period a year earlier, which
contributed to a 3.1 percent decline in content revenue.
The company said the decline was driven by weaker
investments in TV advertising from banking and
telecommunications companies, and that two major clients had
taken their business to competitors that offered promotions.
"Our sales force has been in contact with our advertising
clients and based on those conversations, it believes that the
first quarter of the year is not representative of the likely
outcome of the balance of the year," Executive Vice President
Alfonso de Angoitia said on a conference call with investors.
Televisa posted a 125 percent rise in net profit in the
first quarter largely due to currency fluctuations. Mexico's
peso appreciated about 9 percent from January to March.
But the company's overall growth in the quarter was
"unusually slow" because of soft economic growth in Mexico that
weighed on disposable income and lingering uncertainty after the
U.S. election that dampened consumer confidence, De Angoitia
The company said it expected the first half of 2017 to be
challenging but that the second half of the year would likely be
(Reporting by Miguel Angel Gutierrez and Gabriel Stargardter;
Editing by Meredith Mazzilli)